Reference no: EM132686007

Problem 1: Which of the following statements is true about the activity-based costing method?

a. Service companies should never use the activity-based costing method to determine the cost of providing services to customers.

b. Activity-based costing method allocates factory overhead less accurately than does the single, plantwide overhead rate.

c. Many service companies find that the activity-based costing method can lead to service cost distortions.

d. In complex manufacturing systems, one way to avoid product costs distortion is by using the activity-based costing method.