The Benefits of Using the ABC Costing System Are Higher

question 79

Multiple Choice

The benefits of using the ABC costing system are higher if the company

• A) has high indirect costs.
• B) produces many different products that use differing amounts of resources.
• C) produces only one product.
• D) has high indirect costs and produces many different products that use differing amounts of resources.

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Definitions:

Management Coefficients Model

A strategic management tool that quantitatively assesses managerial impact on company performance, using coefficients to represent the influence of various management actions.

Linear Decision Rule

A decision-making technique that involves creating a linear equation to model the relationship between variables, used to determine the best course of action under certain conditions.

Allocating Capacity

The process of determining how resources, such as production capacity, are assigned or distributed among various demands or projects.