Which of the Following Statements Is True About Activity-Based Costing

question 29

Multiple Choice

Which of the following statements is true about activity-based costing?

• A)Only one activity should be used for a company.
• B)Many different activity bases are used in applying overhead.
• C)There can only be one cost driver.
• D)Direct materials and direct labor are applied to work-in-process based upon cost drivers.

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Definitions:

Brand Loyal

The tendency of consumers to consistently purchase products or services from the same brand over time, often due to satisfaction, perceived value, or emotional connection.

Inertia

A state of inactivity or resistance to change in consumer behavior, often due to habit or perceived effort.

Compensatory Rule

A decision-making strategy where negative attributes can be compensated for by positive attributes.

Product Signal

An indicator or marker that conveys information about the qualities or characteristics of a product to consumers.