The approach to overhead costs under activity-based costing is that:
A)overheads provide service to cost objects.
B)overheads are caused by activities.
C)overheads happen.
D)overheads can be traced to cost objects.

Question

Quizplus · Accepted Answer

Activity-based costing assumes that overhead costs are caused by activities, and by analyzing and allocating these costs based on the specific activities, a more accurate picture can be obtained in terms of the resources consumed by each cost object.

The Approach to Overhead Costs Under Activity-Based Costing Is That