The Benefit of an ABC System Is That It Provides

question 67

True/False

The benefit of an ABC system is that it provides information to make better decisions at a lower costs than traditional (simple)cost systems.

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Definitions:

Speculative Motive

The need to hold cash to take advantage of additional investment opportunities, such as bargain purchases.

Liquidity

The ability of an asset to be converted into cash quickly and without any significant loss in value.

Cyclical Activities

Economic or business activities that are affected by the ups and downs of the economy, showing a tendency to rise and fall in response to economic cycles.

Cash Surpluses

Refers to the amount of cash that exceeds the cash needed to fund immediate expenses and operational activities.