The _____ Costing Method Allocates Costs Across Business Processes, and Provides

question 69

Multiple Choice

The _____ costing method allocates costs across business processes, and provides a more accurate picture of how costs should be charged to products and services.

• A) sales
• B) production
• C) activity-based
• D) capital
• E) operational

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Definitions:

Overhead Application

A method of assigning overhead costs to specific products or job orders based on a predetermined overhead rate.

Direct Labour Hours

The hours worked by employees directly involved in the manufacturing process, used to allocate labor costs to products.

Hotel Industry

A segment of the hospitality sector that focuses on providing lodging facilities and other related services to travelers and guests.

Activity-Based Costing (ABC)

A method of allocating overhead and indirect costs based on the activities that drive these costs, with the aim of providing more accurate product costing.