In an activity-based costing system,manufacturing overhead costs are divided into separate:
A)Cost drivers.
B)Activity cost pools.
C)Activity bases.
D)Indirect cost centers.

Question

Quizplus · Accepted Answer

In an activity-based costing system, manufacturing overhead costs are divided into separate activity cost pools, based on similar activities that consume similar resources. This allows for a more accurate allocation of overhead costs to individual products or services based on the specific activities that were performed to produce each product or service. Cost drivers and activity bases are used within each activity cost pool to allocate the overhead costs to specific products or services. Indirect cost centers are not typically used in activity-based costing systems.

In an Activity-Based Costing System,manufacturing Overhead Costs Are Divided into Separate