A cost that is traceable to a segment through activity-based costing may or may not be an avoidable cost for decision making.

Question

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When using activity-based costing, costs are traced to segments based on activities, and some of these costs may not be avoidable. Avoidable costs are costs that can be eliminated or reduced by choosing a different course of action or decision. Therefore, a cost that is traceable to a segment through activity-based costing may or may not be an avoidable cost for decision making.

A Cost That Is Traceable to a Segment Through Activity-Based