In the second-stage allocation in activity-based costing, activity rates are used to apply overhead costs to products and customers.

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This statement is true. Activity rates, which are calculated by dividing the total cost of each overhead activity by the total quantity of the activity driver, are used to allocate overhead costs to products and customers in the second-stage allocation of activity-based costing.

In the Second-Stage Allocation in Activity-Based Costing, Activity Rates Are