Four basic steps are used in an ABC system. List the proper order of these steps, which are currently scrambled below:
A. Identify the primary activities and estimate a total cost pool for each.
B. Allocate the costs to the cost object using the activity cost allocation rates.
C. Select an allocation base for each activity.
D. Calculate an activity cost allocation rate for each activity.
A)c, a, b, d
B)a, c, d, b
C)b, a, c, d
D)a, d, c, b

Question

Four basic steps are used in an ABC system. List the proper order of these steps, which are currently scrambled below: 
A. Identify the primary activities and estimate a total cost pool for each.
B. Allocate the costs to the cost object using the activity cost allocation rates.
C. Select an allocation base for each activity.
D. Calculate an activity cost allocation rate for each activity.
A)c, a, b, d
B)a, c, d, b
C)b, a, c, d
D)a, d, c, b

Quizplus · Accepted Answer

The proper order of steps in an ABC system is:
1. Identify the primary activities and estimate a total cost pool for each. (A)
2. Select an allocation base for each activity. (C)
3. Calculate an activity cost allocation rate for each activity. (D)
4. Allocate the costs to the cost object using the activity cost allocation rates. (B)
Therefore, the correct order is A, C, D, and B. The answer choice B matches this order.

Four Basic Steps Are Used in an ABC System