A key reason for using an ABC system rather than a department-costing system is because ABC assigns indirect costs:
A)using broader averages
B)more simply than a department-costing system
C)in a less costly manner
D)to reflect differences required by different processes as well as customers

Question

Quizplus · Accepted Answer

ABC assigns indirect costs to reflect differences required by different processes as well as customers, thus providing a more accurate picture of the costs associated with each product or service. This is not possible with a department-costing system, which assigns indirect costs to departments using broad averages. While ABC may require more resources and be more costly to implement, it provides a more detailed and accurate understanding of costs.

A Key Reason for Using an ABC System Rather Than