What is the basic premise behind activity-based costing systems (ABC)? What is an activity? Describe how ABC systems work.
What will be an ideal response?
Answers will vary
The basic premise behind ABC is that activities drive costs. Significant reductions in product costs can be achieved only by managing those activities that drive the costs. Activity-based costing is a two-stage allocation process that employs multiple cost pools and cost drivers. Activities are actions taken by an organization to accomplish its mission. Activity cost pools are often established along hierarchical lines (i.e., unit-level, batch-level, product-level, and facility-level) with separate cost drivers (both volume- and activity-based) for each cost pool. In the first stage, overhead costs are traced to specific activity cost pools. In the second stage, activity rates are developed and used to assign activity costs to the firm's products and services.
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Free cash flow is
a. all cash in the bank b. cash from operations c. cash from financing less cash used to purchase fixed assets to maintain productive capacity and cash usedfor dividends d. cash flow from operations less cash used to purchase fixed assets to maintain productive capacity
One type of revenue is the settlement of a liability that occurs as a result of a company's primary operating activities
Indicate whether the statement is true or false
This question contains two parts; be sure to answer both. First, what do followers want in their leaders? Second, think about a person who has been in a leadership position above you (perhaps a teacher or a boss). How well did that person meet each of these criteria?
What will be an ideal response?
George and James create an agency relationship to facilitate the sale of illegal narcotics. This agency relationship
a. is illegal. b. is legal. c. will be recognized by some states, but not others. d. can exist, but will be subject to sanctions for illegal activity.