Which of the Following Statements Is False Regarding the Identification

question 78

Multiple Choice

Which of the following statements is false regarding the identification of activities in activity-based costing (ABC) ?

• A) The identification of activities that drive overhead costs is done before cost drivers are selected.
• B) An activity can be thought of as a procedure or process that causes work to be accomplished.
• C) Overhead costs should not be traced to more than one activity.
• D) Because of different types of production processes and products, every business will have a different set of activities and cost drivers.

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Definitions:

Supplemental Ledger

Supplemental ledger is an accounting ledger used for keeping detailed information that supports figures stated in the general ledger, providing additional details or breakdowns.

Primary Ledger

The main accounting record used by a business to keep track of all the financial transactions.

Accounts Receivable Subsidiary Ledger

A detailed record showing the individual transactions and balances for customers who owe the company money, supporting the summary balances shown in the general ledger.

Controlling Account

An account in the general ledger that summarizes the total balances of all individual accounts in a subsidiary ledger.