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3 January, 05:28

A company may use several different cost drivers to allocate its indirect costs.

a. True

b. False

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Answers (1)
  1. 3 January, 05:55
    0
    The correct answer is a. True.

    Explanation:

    A company may use several different cost drivers to allocate its indirect costs. In ABC system indirect cost/FOH are divided into various activities that is material procurement, inspection and maintenance cost and cost is allocated to each product based on different cost driver assign to each activity. The cost drivers for above specified cost activities can be number of purchase orders, inspection hours and number of break downs respectively.
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