A single indirect-cost rate distort product costs because ________.
A) there is an assumption that all support activities affect all products
B) it recognizes specific activities that are required to produce a product
C) competitive pricing is ignored
D) it assumes all costs are product costs

Question

Quizplus · Accepted Answer

A single indirect-cost rate assumes that all support activities affect all products equally, which is rarely the case. This can lead to distortions in product costs and may lead to incorrect pricing decisions.

A Single Indirect-Cost Rate Distort Product Costs Because ________