Which of the following statements which is correct? The basic principle of activity-based costing (ABC) is that:

Question

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The basic principle of activity-based costing (ABC) is that cost units should bear the cost of the activities they cause. This means that costs are allocated to cost units based on the activities they use, rather than simply on the basis of direct labor hours or other such methods that may not accurately reflect the actual costs incurred by each cost unit. This approach can provide more accurate information for decision-making and help managers better understand the true costs of their products or services.

Which of the Following Statements Which Is Correct? the Basic