Reference no: EM132751648

Problem 1: How can broad averaging (peanut butter costing) inappropriately cost products or services? What are the potential problems that can arise from using a traditional costing system? Give an example of a well-known company, and identify what it might use to allocate overhead costs to products using a traditional system. Next, indicate what activities the company might identify if they were to use an ABC system. Why might an ABC system be better? Participate in follow-up discussion by adding to your classmates' comments.