When a company changes from a traditional costing system to an activity-based costing system, the unit product costs of high-volume products typically change more than the unit product costs of low-volume products.

Question

Quizplus · Accepted Answer

Activity-based costing (ABC) allocates overhead costs more accurately to products by using multiple cost drivers, which often results in high-volume products showing lower unit cost changes compared to low-volume products, as the overheads are spread over more units.

When a Company Changes from a Traditional Costing System to an Activity-Based