Which of the following statements is true concerning finding a cost-allocation base for activity-based costing?
A)Finding the cost-allocation base is justified if the benefits from improved decisions exceed the costs of finding and using the base.
B)Finding the cost-allocation base is usually difficult and costly.
C)Finding the cost-allocation base may require the accumulation of extensive data in addition to the regular accounting information.
D)All of the answers are correct.

Question

Quizplus · Accepted Answer

All of the answers are correct. Finding an appropriate cost-allocation base for activity-based costing may be difficult, time-consuming, and costly, and may require additional data accumulation beyond regular accounting information. However, it is justified if the benefits of improved decision-making outweigh the costs of the effort. Therefore, all the statements are true.

Which of the Following Statements Is True Concerning Finding a Cost-Allocation