Activity-based costing (ABC) has arisen from the apparent limitations found in traditional absorption costing systems. Which ofthe following is NOT a limitation oftraditional absorption costing? It can give a distorted product cost where a diverse range of products with a mix of high and low volumes exist. 0 It assumes products consume resources in relation to volume measures. It provides inadequate information for managers to make informed decisions about the true cost of producing a product. It requires many calculations to determine the costs of products and services. In contrast, ABC usually requires less calculations. A company uses LIFO to value inventory. The inventory movements for raw material X for the month of December were as follows: 8 December Purchase 200 units at f24 per unit 16 December Issued to production 150 units 22 December Purchase 250 units at f25 per unit 27 December Issued to production 325 units On 1 December the inventory was 160 units valued at $4, 160. What is the value of issues to production for the month of December? E11,400 B E11,700 E11,875 D E11,835Question 4 10 Points The classification of costs as direct or indirect depends on which of the following: 1. Definition of the cost unit/cost objective 2. The practicality of tracing a cost item to the cost unit/objective 3. Availability of information A 1 and 2 only B 2 and 3 only C 1 and 3 only D All of them