An Activity-Based Costing System Is Developed in Four Steps

question 79

Multiple Choice

An activity-based costing system is developed in four steps:
a.Compute the predetermined overhead allocation rate for each activity.
B.Identify activities and estimate their total indirect costs.
C.Identify the allocation base for each activity and estimate the total quantity of each allocation base.
D.Allocate indirect costs to the cost object.
Which of the following is the correct order for performing these steps?

• A) a, b, c, d
• B) c, a, b, d
• C) b, c, a, d
• D) b, a, c, d

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Definitions:

Situational Constraints

External factors or conditions that limit or influence an individual's performance in the workplace or other environments.

Technical Knowledge

Understanding of the practical aspects of a specific field, including the ability to apply relevant skills and expertise.

Request For Proposal

A formal document that an organization posts to solicit bids from potential vendors for a project or service.