Indications that a product cost system needs revision include:
A)managers lose bids they expected to win and win bids they expected to lose.
B)employees do not believe the cost numbers are accurate.
C)the company uses a single-allocation-base system developed long ago.
D)all of the above.

Question

Quizplus · Accepted Answer

All three statements indicate that the current product cost system may not be providing accurate information. Losing expected bids and winning unexpected bids could indicate that the cost estimates are not competitive or too high/low, employees not believing the cost numbers implies a lack of trust in the system, and using a single-allocation-base system developed a long time ago could indicate the need for an update to reflect changes in the business environment. Therefore, all three statements point towards the need for a revision of the product cost system.

Indications That a Product Cost System Needs Revision Include