An activity-based costing system first traces costs to activities and then to products.

Name: An activity-based costing system first traces costs to activities and then to products.
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Question

Quizplus · Accepted Answer

Activity-based costing (ABC) system follows a two-stage process for cost allocation. Firstly, costs are assigned to activities and then activities are assigned to products based on their usage. This approach provides a more accurate measurement of product cost compared to traditional costing methods.

An Activity-Based Costing System First Traces Costs to Activities and Then