The System That First Traces Costs to Activities and Then

question 21

Multiple Choice

The system that first traces costs to activities and then to products is called:

• A) direct costing
• B) absorption costing
• C) functional-based costing
• D) activity-based costing

---

Definitions:

Investor

Someone or a group that puts money into ventures aiming for a return in terms of finance.

Compounded Semi-Annually

Refers to the process where interest is added to the principal balance of an investment, loan or deposit twice a year.

Compounded Quarterly

Interest calculation method where the interest is added to the principal every quarter, affecting the calculation for subsequent quarters.

Principal

The initial amount of money borrowed or invested, excluding any interest or dividends.