ABC Systems Differ from Traditional Costing Systems Because ABC Systems

question 21

Multiple Choice

ABC systems differ from traditional costing systems because ABC systems use

• A) Multiple activity cost pools and cost drivers to allocate overhead costs
• B) More automation and information technology to allocate overhead costs
• C) Less automation and information technology to allocate overhead costs
• D) a and b

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Definitions:

Tariff Barrier

Taxes imposed on imported goods and services to restrict imports, protect domestic industries, or raise government revenue.

Licensing Agreement

A legal contract by which a rights holder permits another party to use a property, such as intellectual property or technology, under specified conditions.

Foreign Corrupt Practices Act

A U.S. law that prohibits American companies and individuals from bribing foreign officials to retain or obtain business.

Countertrade

A form of international trade in which goods or services are exchanged directly for other goods or services without using a medium of exchange, such as money.