Companies with diverse products can obtain better costing information by using a single plantwide rate for allocating manufacturing costs.

Question

Quizplus · Accepted Answer

Companies with diverse products may have different production processes and cost structures, so using a single plantwide rate to allocate manufacturing costs may not accurately reflect the actual costs of producing each product. Using multiple departmental or activity-based rates may provide more accurate costing information for diverse products.

Companies with Diverse Products Can Obtain Better Costing Information by Using