5. The traditional approach to cost allocation A. tends to over-cost high volume core products. B. usually requires more cost pools than ABC. C. attempts to identify the activities that cause costs. D. produces more accurate costs than any other method.

6. Which of the following steps is not involved in the ABC approach? A. Identify activities which cause costs to be incurred. B. Allocate costs to products based on activity usage. C. Group costs of activities into cost pools. D. Improve processes based on benchmarking.

7. Frio Company uses ABC costing. Which of the following is most likely to be the cost driver for the cost of ordering parts? A. weight of parts ordered B. direct labor cost C. depreciation expense D. number of orders placed