Which of the following statements is true about activity-based costing?
A)Only one activity should be used for a company.
B)Many different activity bases are used in applying overhead.
C)There can only be one cost driver.
D)Direct materials and direct labor are applied to work-in-process based upon cost drivers.

Question

Quizplus · Accepted Answer

Activity-based costing uses many different activity bases to allocate overhead costs to specific products or services. This allows for a more accurate and detailed understanding of the costs involved in producing different products or providing different services.

Which of the Following Statements Is True About Activity-Based Costing