In an Activity-Based Costing (ABC)system,what Should Be Used to Assign

question 103

Multiple Choice

In an activity-based costing (ABC) system,what should be used to assign departmental manufacturing overhead costs to products produces in varying lot sizes?

• A) A product's ability to bear cost allocations.
• B) A single cause-and-effect relationship.
• C) Multiple cause-and-effect relationships.
• D) Relative net sales values of the products.

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Definitions:

Capital Gain

The increase in the value of a capital asset that gives it a higher worth than the purchase price.

Straight Line Depreciation

A strategy for dividing the cost of a material asset into equal yearly portions throughout its estimated useful duration.

Salvage Value

The estimated residual value of an asset after its useful life has ended.

Marriage Penalty

In the tax system, the phenomenon that a two-income married couple pays more tax than the sum of two single people making the same money.