Asked by Juana Jacal on May 16, 2024
Verified
In activity-based costing, as in traditional costing systems, manufacturing costs are not assigned to products.
Traditional Costing Systems
A method of accounting that allocates overhead costs based on a predetermined rate, often not capturing the actual costs of production accurately.
Manufacturing Costs
The expenses involved in the production of goods, including labor, raw materials, and overhead.
- Comprehend the basic principles of activity-based costing (ABC) and its differentiation from conventional costing approaches.
Verified Answer
KC
Kelsey CorderMay 21, 2024
Final Answer :
False
Explanation :
In activity-based costing, manufacturing costs are assigned to products based on their usage of activities, unlike traditional costing systems where they are assigned based on direct labor or machine hours.
Learning Objectives
- Comprehend the basic principles of activity-based costing (ABC) and its differentiation from conventional costing approaches.
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