All of the following are disadvantages of activity-based costing (ABC)except:
A)ABC systems are expensive.
B)ABC systems provide inaccurate product cost data.
C)Companies with one or two products may see little benefit from an ABC system.
D)Unit fixed costs can be misleading.
E)None of the answer choices is correct.

Question

Quizplus · Accepted Answer

Activity-based costing (ABC) systems are generally more accurate than traditional costing methods, but they can still produce inaccurate product cost data. However, ABC systems are not typically more expensive than other costing methods and can be beneficial for companies with a few products. Unit fixed costs can be misleading, but this is not a disadvantage unique to ABC systems. Therefore, B is the correct answer.

All of the Following Are Disadvantages of Activity-Based Costing (ABC)except