Which of the Following Are True Regarding Activity-Based Costing

question 84

Multiple Choice

Which of the following are true regarding activity-based costing?

• A) A primary goal of using ABC is the accurate allocation of manufacturing overhead to product lines.
• B) Under ABC, direct labor hours is never used to allocate overhead costs to activity pools or product lines.
• C) The use of ABC is indicated when it is suspected that each of the firm's product lines consume approximately the same amount of overhead resources but the current allocation scheme assigns each line a substantially different amount.
• D) ABC can be used in conjunction with process costing.

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Definitions:

Intrinsically Imperfect

Suggests that something has inherent flaws or limitations, emphasizing the idea that imperfection is a fundamental aspect of its nature.

Imperfectible

The belief that it is impossible to achieve perfection or complete improvement in the human condition.

Functional

In sociology, referring to the aspects of societies or institutions that contribute to their stability and continuity by fulfilling necessary roles.

Practical

Pertains to real-world applications or actions rather than theoretical ideas, emphasizing usability and effectiveness in everyday situations.