Asked by Mateo Hoyos on Jun 23, 2024
Verified
A cost that is assigned to a product using activity-based costing may or may not be a relevant cost in a decision involving that product.
Activity-based Costing
A pricing strategy that allocates expenses to goods or services according to the tasks they necessitate, striving for a more accurate distribution of costs.
Relevant Cost
A cost that should be considered when making decisions.
- Implement the principles of activity-based costing to identify pertinent costs.
Verified Answer
SC
Sisters ChannelJun 28, 2024
Final Answer :
True
Explanation :
Activity-based costing assigns costs to products based on activities involved in their production. While these costs may provide a more accurate picture of the total cost of producing a product, not all of these costs may be relevant to a decision involving that product, such as whether to accept a special order or discontinue a product line. Therefore, some costs assigned through activity-based costing may not be considered relevant costs in certain decision-making scenarios.
Learning Objectives
- Implement the principles of activity-based costing to identify pertinent costs.
Related questions
A Cost That Is Traceable to a Segment Through Activity-Based ...
Which of the Following Statements Is Most Complete and Correct ...
Which Term Describes a Cost Resulting from the Existence of ...
In Activity-Based Costing Analysis, the Manufacturing Manager's Salary Is Classified ...
Using Activity-Based Costing Is Not Useful in Determining Costs of ...