Which of the following statements is (are)true regarding the potential effects of using reported product costs for decision making? (A)Traditional product costing systems (e.g. ,job and process costing)are designed primarily to accumulate cost information for financial reporting.(B)If a single cost driver is used as the allocation base,applied manufacturing overhead for product costing purposes may lead to inappropriate managerial decisions.
A)Only A is true
B)Only B is true.
C)Both A and B are true.
D)Neither A nor B is true.

Question

Quizplus · Accepted Answer

Both statements A and B are true regarding the potential effects of using reported product costs for decision making. Traditional product costing systems are designed primarily for financial reporting purposes and may not align with managerial decision-making needs. Moreover, if a single cost driver is used as the allocation base, applied manufacturing overhead for product costing purposes may lead to inappropriate managerial decisions.

Which of the Following Statements Is (Are)true Regarding the Potential