Activity-based budgeting includes all the following steps EXCEPT:
A)computing the cost of performing activities.
B)determining a separate cost-driver rate for each department.
C)describing the budget as costs of activities rather than costs of functions.
D)determining demands for activities from sales and production targets.

Question

Quizplus · Accepted Answer

Activity-based budgeting involves computing the cost of performing activities, determining the demands for activities from sales and production targets, and describing the budget as costs of activities rather than costs of functions. However, it does not involve determining a separate cost-driver rate for each department as that is a step in departmental budgeting.

Activity-Based Budgeting Includes All the Following Steps EXCEPT