Companies with diverse products can obtain better costing information using multiple departmental rates rather than using activity-based costing.

Question

Quizplus · Accepted Answer

This statement is false. Activity-based costing is specifically designed to handle situations where a company has diverse products and multiple departmental rates may not provide accurate costing information. Activity-based costing takes into account the different activities that go into producing a product and allocates costs accordingly, providing a more accurate picture of the true cost of each product or service.

Companies with Diverse Products Can Obtain Better Costing Information Using