When a company changes from a traditional costing system to an activity-based costing system, the unit product costs of low-volume products typically change more than the unit product costs of high-volume products.

Question

Quizplus · Accepted Answer

Activity-based costing focuses on identifying and assigning costs to specific activities required to produce a product, rather than using broad averages. This can result in a more accurate allocation of costs to low-volume products that require unique activities, therefore impacting their unit product costs more than high-volume products.

When a Company Changes from a Traditional Costing System to an Activity-Based