_____ systems lump (and therefore hide) the charges for resources that have been paid for whether or not they are utilized.
A)Activity-based costing
B)First-in,first-out costing
C)Traditional costing
D)Last-in,last-out costing

Question

Quizplus · Accepted Answer

Traditional costing systems allocate overhead costs to products based on a predetermined overhead rate that is calculated using estimated usage levels of resources. This approach can result in hiding the costs of resources that were paid for but not utilized, which can lead to inaccurate costing and pricing decisions for products. Activity-based costing is a more accurate approach that assigns overhead costs to products based on their actual usage of resources, rather than on a predetermined rate, and does not hide unused resource costs. First-in, first-out costing and last-in, last-out costing are inventory costing methods, and are not relevant to the question.

_____ Systems Lump (And Therefore Hide) the Charges for Resources