Which of the Following Items Might Cause Activity-Based Costing (ABC)

question 52

Multiple Choice

Which of the following items might cause activity-based costing (ABC) to be more difficult to implement in a service company than in a manufacturing company?

• A) The lack of direct labor.
• B) The lack of facility-level costs.
• C) The lack of repetitive activities.
• D) The lack of overhead costs.

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Definitions:

Variable Rate

An interest rate that can change over the duration of a loan, typically based on underlying benchmarks or indexes affecting the cost of lending.

LANs

Local Area Networks, a computer network that interconnects computers within a limited area such as a residence, school, or office building.

On-demand Self-service

On-demand self-service refers to the provision of services, resources, or information that can be accessed by users autonomously and immediately when needed, typically over the internet.

Elasticity

Elasticity refers to the economic concept describing the change in the behavior of buyers and sellers in response to a change in price or other factors.