Which of the following statements is typically not true about activity based costing?
A) Improves the tracing of costs to the product or service that consumed the cost
B) Helps to identify costs that were arbitrarily allocated in the past using a volume based driver, such as direct labor
C) Identifies the true (or more logical) drivers of indirect costs
D) ABC is used by the majority of major corporations throughout the world
E) Examples of cost drivers used in ABC include: number of orders, length of setups, engineering changes

Question

Quizplus · Accepted Answer

While ABC is a widely used costing methodology, it is not true that the majority of major corporations throughout the world use this approach. Therefore, statement D is typically not true.

Which of the Following Statements Is Typically Not True About