38. Activity based costing can improve costing activity for a) Manafacturing companies only b) Service companies only c) d) e) Any company in any industry entities only. 39. If a firm uses activity-based costing to allocate costs, it does all but which of the following? a) Combine homogenous costs in appropriate pools. b) Select appropriate cost drivers. c) Calculate an appropriate rate for each pool. d) Allocate costs based on predetermined rates for cost pools e) Apply a volume-related measure per unit of product 40. An activity-based cost allocation system a) is one form of a direct or variable costing system b) does not provide total unit cost data c) traces costs to products on the basis of activities performed on them d) does not provide for the alliocation of any cost to products that cannot be directly traced to those products e) does not involve the level of detail and the number of allocations that companies make with traditional allocation methods 1. Which of the following is not a limitation of activity-based costing? a) Maintaining an ABC system is more costly than maintaining a traditional direct labor-based costing system b) Changing from a traditional direct labor-based costing system to an ABC system changes product margins and other key performance indicators used by managers More accurate product costs may result in increasing the selling prices of some products. d) All of the above are limitations 42. A factor that causes the cost of an activity to go up or down is akn) a) Direct factor )Indirect factor c) Cost driver d) Product cost. e) Contribution factor