An activity-based costing system that is designed for internal decision-making will not conform to generally accepted accounting principles because:

Multiple Choice

• under activity-based costing some manufacturing costs (i.e., the costs of idle capacity and organization-sustaining costs) will not be assigned to products.

• under activity-based costing the sum of all product costs does not equal the total costs of the company.

• activity-based costing has not been approved by the United Nations International Accounting Board.

• activity-based costing results in less accurate costs than more traditional costing methods based on direct labor-hours or machine-hours.