Customer profitability analysis is best conducted with the tools of an accounting technique called ________.
A) input-output analysis
B) factor analysis
C) revenue-based costing
D) activity-based costing
E) future date costing

Question

Quizplus · Accepted Answer

Activity-based costing is a technique used to analyze the cost and profitability of each activity of the organization. This allows for a more accurate allocation of costs to each customer, leading to a better understanding of the profitability of each customer. Input-output analysis and factor analysis are not suitable for customer profitability analysis. Revenue-based costing and future date costing are not commonly used techniques in accounting.

Customer Profitability Analysis Is Best Conducted with the Tools of an Accounting