With traditional costing systems,products manufactured in large batches and in large annual volumes may be ________ because batch-related and product-sustaining costs are assigned using unit-related cost drivers..
A)overcosted
B)undercosted
C)fairly costed
D)ignored

Question

Quizplus · Accepted Answer

Traditional costing systems often allocate overhead costs based on volume-related measures, such as direct labor hours or machine hours. This approach can lead to overcosting of products manufactured in large batches or volumes, as it may not accurately account for the actual consumption of overhead resources by each product.

With Traditional Costing Systems,products Manufactured in Large Batches and in Large