Which of the Following Statements Is True of Activity-Based Costing

question 128

Multiple Choice

Which of the following statements is true of activity-based costing?

• A) Activity-based costing ignores the allocation of marketing and distribution costs.
• B) Activity-based costing is more likely to result in major differences from traditional costing systems if the firm manufactures only one product rather than multiple products.
• C) Activity-based costing classifies some of the indirect costs as direct costs.
• D) Chances of product-cost cross-subsidization are higher in activity-based costing compared to traditional costing systems.

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Definitions:

Noncyclic Electron Pathway

A pathway of photosynthesis where electrons flow in a linear manner from water to NADP+, producing NADPH without the return of electrons to the light-absorbing pigment.

Calvin Cycle

A set of chemical reactions that take place in chloroplasts during photosynthesis, where carbon dioxide is converted into glucose.

G3P

Glyceraldehyde 3-phosphate, a three-carbon sugar molecule that plays a central role in both the Calvin cycle of photosynthesis and the glycolysis metabolic pathway.

Organic Molecules

Compounds mainly containing carbon atoms, along with hydrogen, oxygen, and other elements, that are the basis of life.