ABC Systems Always Provide Decision-Making Benefits That Exceed Implementation Costs

question 103

True/False

ABC systems always provide decision-making benefits that exceed implementation costs.

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Definitions:

Step-Down Method

An accounting method used in cost allocation that sequentially allocates service department costs to other departments, including production ones.

Support Department

A division within an organization that provides essential services or support to the primary operations or profit centers.

Finishing Department

The section in manufacturing where products undergo final processing, assembly, or completion.

Cost Allocated

The distribution of indirect costs to different cost objects, to fairly attribute overhead expenses to products or services.