With activity-based costing,the goal is to
A)Develop a product cost that captures the amount of each resource consumed by the activities performed to produce a specific product.
B)Develop a product cost that allocates manufacturing overhead to each resource consumed by the activities performed to a group of similar products.
C)Develop a product cost that eliminates all waste such as machine down time and defective products.
D)None of these ans choices are correct..

Question

Quizplus · Accepted Answer

Activity-based costing aims to allocate costs to specific activities in the production process and then assign those costs to products based on the amount of resources consumed by each activity. This allows for a more accurate determination of product costs and can help identify areas where costs can be reduced or eliminated. Option B is incorrect because it suggests allocating overhead costs to groups of products, rather than to the specific resources used by each product. Option C is incorrect because while activity-based costing can help identify waste, its primary objective is to accurately allocate costs rather than eliminate waste. Finally, option D is incorrect because A is a correct answer.

With Activity-Based Costing,the Goal Is to