What is the typical effect on the numbers of cost pools and cost assignment bases when an activity-based costing (ABC)system replaces a traditional costing system? (CPA adapted) $$\begin{array} { | l | c | c | }
\hline & \text { Cost Pook } & \text { Cost Assignment Bases } \
\hline \text { A. } & \text { No effect } & \text { No effect } \
\hline \text { B. } & \text { Increase } & \text { No effect } \
\hline \text { C. } & \text { No effect } & \text { Increase } \
\hline \text { D. } & \text { Increase } & \text { Increase } \
\hline
\end{array}$$
A) Option A
B) Option B
C) Option C
D) Option D

Question

What is the typical effect on the numbers of cost pools and cost assignment bases when an activity-based costing (ABC)system replaces a traditional costing system? (CPA adapted) $$\begin{array} { | l | c | c | } 
\hline & \text { Cost Pook } & \text { Cost Assignment Bases } \
\hline \text { A. } & \text { No effect } & \text { No effect } \
\hline \text { B. } & \text { Increase } & \text { No effect } \
\hline \text { C. } & \text { No effect } & \text { Increase } \
\hline \text { D. } & \text { Increase } & \text { Increase } \
\hline
\end{array}$$
A) Option A
B) Option B
C) Option C
D) Option D

Quizplus · Accepted Answer

An activity-based costing (ABC) system typically increases both the number of cost pools and cost assignment bases compared to a traditional costing system, as it allocates costs more precisely based on activities.

What Is the Typical Effect on the Numbers of Cost