Firms Are Abandoning Activity Based Costing (ABC) Because

question 41

Multiple Choice

Firms are abandoning Activity Based Costing (ABC) because

• A) it does not facilitates the analysis of variances
• B) it is complex and time consuming
• C) it does not recognize the importance of direct labor as a component of total manufacturing cost
• D) the financial nature of the reports does not permit comparisons to be made among different types of products

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Definitions:

Third Restatement

A reference in U.S. legal doctrine, particularly in the context of tort law, to the latest revision of a comprehensive guide on legal principles.

Principal Incapacitated

Principal incapacitated refers to a situation where the principal party in a legal or financial agreement is unable to make decisions or fulfill their role, due to physical or mental incapacity.

Legal Status

The condition of an entity or individual’s standing in the eyes of the law, including rights, responsibilities, and current liabilities.

Power of Agent

The legal authority granted to an individual (agent) to make decisions and take actions on behalf of another person or entity (principal).