A Difference in GAAP-Based Product Costing and Activity-Based Costing Is

question 24

Multiple Choice

A difference in GAAP-based product costing and activity-based costing is that under activity-based costing

• A)all costs are classified as product and period costs whereas under GAAP they are classified by behavior.
• B)sales less cost of goods sold is classified as gross profit whereas under GAAP this subtotal is titled contribution margin.
• C)selling and administrative costs are allocated to products if they are incurred to provide resources that are consumed by unit-level,batch-level or product-level activities.
• D)all costs are traceable whereas in GAAP-based costing all costs are not traceable.

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