Question

Activity-based costing (ABC) systems ________. A. Unselected have the same cost allocation system as plantwide and departmental cost allocation systems B. Unselected have no cost allocation rates for each activity identified by the company C. Unselected have combined cost allocation rates for each activity identified by the company D. Unselected have separate cost allocation rates for each activity identified by the company

Answer 1

Answer:

D. have separate cost allocation rates for each activity identified by the company CORRECT

There will be activity cost pool which, will be distribute among the product using different cost driver like machien hours, direct labor hours or other.

Explanation:

A. have the same cost allocation system as plantwide and departmental cost allocation systems

NO If it was, then it would not have a different name

B. have no cost allocation rates for each activity identified by the company

If we don't have rates to distrubte cost then, the allocation will be arbitrary

C. have combined cost allocation rates for each activity identified by the company

each should have different base cost driver if not, then they aren't different and should be combined.