The Benefits of Using the ABC Costing System Are Higher

question 226

Multiple Choice

The benefits of using the ABC costing system are higher if the company

• A)has high indirect costs.
• B)produces many different products that use differing amounts of resources.
• C)has high indirect costs and produces many different products that use differing amounts of resources.
• D)produces only one product.

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Definitions:

Units of Output

The quantity of product or service produced by a company, industry, or economic sector.

Marginal Product

The additional output resulting from the use of one more unit of a production input, holding other inputs constant.

Total Product

The overall quantity of output produced by a firm from a given amount of inputs within a certain period.

Quality Tools

Instruments or techniques used to enhance product or service quality through problem-solving, process analysis, and improvement strategies.