When estimating the cost function for each cost pool, the manager must pay careful attention to the cost hierarchy because the cost pool may have more than one cost driver from different levels of the cost hierarchy.

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The statement is true. The cost hierarchy includes different levels of costs, such as facility-level, batch-level, product-level, and unit-level costs. Each cost pool may have more than one cost driver from different levels of the cost hierarchy, and the manager must consider this hierarchy when estimating the cost function for each cost pool.

When Estimating the Cost Function for Each Cost Pool, the Manager