Activity-based costing
A)is a tool for identifying the activities that cause a company's product to be strongly differentiated from the products of rivals.
B)is far superior to SWOT analysis for analyzing a firm's internal situation.
C)involves developing a "worry list" of problems and issues for managerial strategy making.
D)is an accounting system that assigns a company's expenses to whichever activity in a company's value chain is responsible for creating the cost.
E)involves determining which value chain activities represent variable costs and which represent fixed costs.

Question

Quizplus · Accepted Answer

Activity-based costing is an accounting system that assigns a company's expenses to whichever activity in a company's value chain is responsible for creating the cost. It helps to determine the true cost of producing a product or providing a service by analyzing the costs involved in the various activities in the value chain.

Activity-Based Costing