All of the following are true with regards to activity-based costing for service businesses except a. the multiple department factory overhead rate method may lead to distortions of costs. b. activity-based costing is not applicable to service businesses. c. the single plantwide factory overhead rate method may lead to distortions of costs. d. All of these choices are true.

Question

Irvin Pittman

Business

9 December, 18:13

All of the following are true with regards to activity-based costing for service businesses except a. the multiple department factory overhead rate method may lead to distortions of costs. b. activity-based costing is not applicable to service businesses. c. the single plantwide factory overhead rate method may lead to distortions of costs. d. All of these choices are true.

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Answers (1)

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Nicolas Porter · Answer 1

b. activity-based costing is not applicable to service businesses.

Explanation:

b. - activity cost was created with the idea of being used for sercive business. It distribute the phases of the service in diferent activities and assing cost to them. This statment is FALSE ABC can be used for service business