When determining customer proﬁtability, activity-based costing can be used to analyze:
A)orders processed.
B)sales visits.
C)special packaging and handling.
D)billing and collections.
E)All of the answers are correct.

Question

Quizplus · Accepted Answer

All of the options listed can be analyzed using activity-based costing to determine customer profitability. Activity-based costing focuses on identifying and analyzing the costs of each activity that goes into producing and delivering a product or service, including orders processed, sales visits, special packaging and handling, and billing and collections. By understanding the costs associated with each of these activities, companies can better understand which customers are profitable and which ones are not.

When Determining Customer Proﬁtability, Activity-Based Costing Can Be Used to Analyze