Increasing the number of indirect cost pools in the companys costing system will not definitely increase the accuracy of the costs of output.

Firstly, if the existing pool is not homogenous, accuracy only increases if the increased cost pools of outputs are increasing in homogeneity.

Secondly, if the existing pool is homogenous, then increasing cost pools would not result in increasing accuracy. For example, the cost pools of direct labor, set-up costs etc. are already homogenous and any increase of cost pools would not increase accuracy.

Need more supporting argument for 1 and 2 points.

d) 'If you increase the number of indirect-cost pools in the company's costing system, you will definitely increase the accuracy of the costs of outputs.' Do you agree or disagree? Explain your answer in two points