Which of the Following Is a Disadvantage of an Activity-Based

question 3

Multiple Choice

Which of the following is a disadvantage of an activity-based costing system?

• A) It classifies some indirect costs as direct costs.
• B) It assumes all costs as direct costs.
• C) It needs activity-cost rates to be updated regularly.
• D) It ignores direct costs of a product.

Compare and contrast related and unrelated diversification.

Know how to evaluate an organization's human resource function.

Understand the basic concepts of utility and how it affects consumer behavior.

Identify how changes in consumption can affect total utility.

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Definitions:

Tax Shifting

The transfer of the burden of a tax from the entity legally responsible for paying it to another party, often consumers, through higher prices.

Tax Evasion

The illegal practice of not paying taxes by not reporting income, reporting expenses not legally allowed, or by not paying taxes owed.

Corporate Profits Tax

A tax imposed on the income or profit earned by corporations.

Equilibrium

A state of balance or stability within a system, where all forces acting upon the system are equal and opposite, leading to no net change.