Managers use ABC systems for information when they focus on long-run decisions and are able to manage activities that affect a broader range of costs.

Question

Quizplus · Accepted Answer

ABC (Activity-Based Costing) systems are often used by managers to allocate costs to specific activities, allowing them to make better decisions about pricing, product mix, and resource allocation. This system also helps to identify areas where costs can be reduced or eliminated, allowing for long-term improvements in profitability. ABC systems are most useful when managers are able to manage activities that affect a broader range of costs, such as production, marketing, and distribution. Therefore, the statement is true.

Managers Use ABC Systems for Information When They Focus on Long-Run