Many traditional product costing systems:
A)trace manufacturing overhead to individual activities and require the development of numerous activity-costing rates.
B)write off manufacturing overhead as an expense of the current period.
C)combine widely varying elements of overhead into a single cost pool.
D)use a host of different cost drivers (e.g., number of production setups, inspection hours, orders processed) to improve the accuracy of product costing.
E)produce results far superior to those achieved with activity-based costing.

Question

Quizplus · Accepted Answer

Traditional product costing systems often combine various overhead costs into a single cost pool, which can lead to less accurate product costing compared to more modern methods like activity-based costing.

Many Traditional Product Costing Systems