A company is proposing the introduction of an activity-based costing (ABC) system as a basis for much of its management accounting information:
(a) Briefly describe how ABC is different from a traditional absorption approach to costing and explain why it was developed.

(b) Discuss the advantages and limitations of this ‘approach based on activities’ for management accounting information in the context of:
(i) Preparing plans and budgets
(ii) Monitoring and controlling operations
(iii) Decision-making, for example, product deletion decisions.