Which of the Following Statements Best Completes This Sentence: 'Activity-Based

question 21

Multiple Choice

Which of the following statements best completes this sentence: 'Activity-based costing …'

• A) asserts that cost behaviour can best be determined if the split between fixed and variable cost is ignored
• B) has replaced standard costing as the preferred method of allocating costs to products
• C) is based on allocating fixed overheads based on the elements that drive them
• D) emphasises the need to obtain a better understanding of the behaviour of overhead costs

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Definitions:

Elements

Fundamental components or aspects that make up a whole, which can be physical substances, principles, or factors.

Underlying Behaviors

Fundamental actions or conduct that are not immediately visible but influence observable behaviors.

Individuals

Refers to single human beings, each with their own unique characteristics, as distinct from a group or an organization.

High-involvement Management

An organizational strategy that focuses on empowering employees by involving them in decision-making processes and providing them opportunities to improve skills and job satisfaction.