What two sets of parameters must be estimated in time-driven ABC?

A. Change of capacity resources due to the quantity of activities performed and change in the supply of resources dependent upon the demand for activities performed through management oversight.

B. Variable and fixed costs must be estimated in time-driven ABC.

C. The capacity cost rate for each type of indirect resource, and an estimate of how much of a resource's capacity is used.

D. The cost rate for each type of direct resource, and the direct costs of consumption of resource's capacity is used.

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"When a company produces both high-volume products andlow-volume products, traditional product costing systems are likely to overcost high-volume products." Do you agree with thisstatement? Explain.

A. Yes, traditional costing systems are more likely to overcostlow-volume products because all direct costs are assigned to products in proportion to the number of production units.

B. No, traditional costing systems underestimate the cost of resources required for high-volume products.

C. Yes, traditional costing systems are more likely to overcosthigh-volume products because all indirect and support costs are assigned to products in proportion to the number of production units and the low-volume products are likely to require higher indirect and support costs per unit.

D. No, traditional costing systems overestimate the cost of resources required for specialty, low-volume products.