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

question 125

Multiple Choice

Which of the following statements is true concerning activity-based costing (ABC) ?

• A)ABC can distort product costs.
• B)ABC fails to recognize that the demand for overhead activities is driven by product-sustaining activities.
• C)ABC permits management to focus on the increased efficiencies and better resource utilization.
• D)ABC first assigns costs to products,then to cost pools.

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Definitions:

Horizontal Transfer

The application of skills and knowledge learned in one area to another within the same level of an organization, promoting versatility and adaptability.

Far Transfer

The application of knowledge or skills learned in one context to a completely different context or situation.

Customer Satisfaction

A measure of how products or services meet or exceed customer expectations, crucial for business success.

Organizational Outcome

The result or effect of an organization's actions, strategies, or processes, often measured in terms of performance, profit, or impact on stakeholders.