If a Company Switches from a Traditional Costing System to an Activity-Based

question 60

True/False

If a company switches from a traditional costing system to an activity-based costing system in which some activities are batch-level and product-level, costs ordinarily shift from high-volume to low-volume products.

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Definitions:

Order To Pay

A directive, usually legal or financial in nature, mandating that a certain amount of money must be paid.

Drawer

The person who writes or issues a bill of exchange, check, or draft, instructing a drawee to pay a specified sum to a payee.

Drawee

The party in a financial transaction who is directed to pay a certain amount of money, typically written on a draft or check.

Cashier's Check

A cashier's check is a check guaranteed by a bank, drawn on the bank's own funds and signed by a cashier.