alleryStart learning →What does activity-based costing aim to do with the share of costs treated as overheads?
AReduce it
BDouble it
CHide it
DFreeze it
Answer & Solution
Correct answer: A. Reduce it
By assigning costs to activities, ABC cuts the pool of costs left as general overhead.
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Related questions
In the CIMA description of ABC, activities are assigned to what?In which journal did Cooper and Kaplan publish ABC articles from 1988?Drucker said ABC also records the cost of what?What limits the use of ABC, especially in services?What is a danger of ABC, like other cost allocation approaches?The chief executive's salary stays unassigned in ABC. What are such costs termed?Why did indirect costs rise relative to direct costs in modern factories?How does ABC assign costs, rather than using broad arbitrary percentages?