Activity-based costing usually indicates that large costs are associated with products that are produced in large quantities.

Question

Quizplus · Accepted Answer

Activity-based costing (ABC) allocates overhead costs based on the activities that drive those costs, rather than on volume alone. This means that products requiring more complex activities or more resources can have higher costs assigned to them, regardless of the quantity produced.

Activity-Based Costing Usually Indicates That Large Costs Are Associated with Products