Indicate whether each of the following is more descriptive of a traditional system or an ABC system:
Question:
Indicate whether each of the following is more descriptive of a traditional system or an ABC system:
a. Costs are classified as unit, batch, product sustaining, customer sustaining, and facility sustaining.
b. Costs are captured first by departments and then assigned to jobs, products, services, or customers.
c. Standard products are often overcosted and specialty products are often undercosted.
d. More indirect costs are usually directly traced to various products, services, jobs, or customers.
e. Overhead is generally averaged with few bases.
f. This approach is especially appropriate if a company produces many products and has varying levels of complexity.
g. Complex, low-volume products are typically assigned very few costs even though they often use a lot of resources.
Step by Step Answer:
Managerial Accounting
ISBN: 9780137689453
1st Edition
Authors: Jennifer Cainas, Celina J. Jozsi, Kelly Richmond Pope