A possible solution to overcome distortions caused by unit level rates is
A)assign costs by multiplying activity rates times the amount of activity consumed.
B)calculate individual rates for each activity with activity drivers.
C)increase the number of rates used that reflect the diverse activity and nonunit overhead drivers.
D)all of these.

Question

Quizplus · Accepted Answer

All of the options listed can be used to overcome distortions caused by unit level rates. Assigning costs by multiplying activity rates times the amount of activity consumed can help to more accurately reflect the costs of different activities. Calculating individual rates for each activity with activity drivers can help to identify the specific costs associated with each activity. Increasing the number of rates used that reflect the diverse activity and nonunit overhead drivers can help to capture more of the costs of different activities. Therefore, all options are viable ways to overcome distortions caused by unit level rates.

A Possible Solution to Overcome Distortions Caused by Unit Level