Which of the following is not true about the benefits and costs of activity-based costing systems?
A)It requires managers to estimate the cost of activity pools.
B)It requires few calculations to determine costs of products and services.
C)It requires many calculations to determine costs of products and services.
D)The activity cost rates need to be updated frequently.
E)The managers can misidentify the time spent implementing the system.

Question

Quizplus · Accepted Answer

Activity-based costing systems require many calculations to determine costs of products and services, as it involves estimating the cost of activity pools and assigning them to products or services using cost drivers. The activity cost rates also need to be updated frequently, and there is a risk that managers can misidentify the time spent implementing the system. Option B is not true because activity-based costing systems require a considerable amount of calculations to accurately determine costs.

Which of the Following Is Not True About the Benefits