Using a broad average to allocate costs to products is called
A) activity-based costing.
B) refined costing.
C) cost smoothing.
D) product undercoating.
E) job costing.

Question

Quizplus · Accepted Answer

Using a broad average to allocate costs to products is known as cost smoothing. This method is simpler and less accurate than activity-based costing, which allocates costs based on specific activities performed in relation to each product or service. Refined costing is not a commonly used term in manufacturing costing, and product undercoating is not a recognized term in cost accounting practices. Job costing is a specific costing method that tracks costs for each individual job or production order.

Using a Broad Average to Allocate Costs to Products Is