An Activity-Based Costing System That Is Designed for Internal Decision-Making

question 67

Multiple Choice

An activity-based costing system that is designed for internal decision-making will not conform to generally accepted accounting principles because:

• A)some manufacturing costs (i.e., the costs of idle capacity and organisation-sustaining costs) will not be assigned to products
• B)some non-manufacturing costs are assigned to products.
• C)first-stage allocations may be based on subjective interview data.
• D)all of the above are reasons why an activity-based costing system that is designed for internal decision-making will not conform to generally accepted accounting principles.

---

Definitions:

Motion Parallax

A technique of depth perception where objects closer to the viewer move faster across the visual field than objects further away.

Monocular

Pertaining to or concerning solely one eye.

Binocular

Relating to, used by, or involving both eyes at the same time for obtaining visual perception.

Kinetic

Pertaining to motion, objects being in motion or the study of dynamics that involve motion.