Which of the following might be a reason that allocating overhead under an activity-based approach might have less manufacturing overhead allocated to the products?
A)The general overhead cost pool is not allocated to products under activity-based costing.
B)The product mix includes products that are not similar in material and labor.
C)The product mix has all products that are similar in makeup of materials and labor.
D)The general overhead cost pool is allocated to products under activity-based costing.

Question

Quizplus · Accepted Answer

Activity-based costing allocates overhead based on activity levels, rather than using a general overhead cost pool. This means that some overhead costs that might have been allocated to products under a traditional costing approach might not be allocated to products under activity-based costing.

Which of the Following Might Be a Reason That Allocating