Asked by Schyler Molloy on Jun 05, 2024

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A traditional cost system is generally easier to set up and run than an activity-based costing system.

Traditional Cost System

A costing methodology that assigns manufacturing overhead based on volume-related measures, often neglecting the complexity or variety of activities.

Activity-Based Costing

An accounting method that assigns costs to products based on the activities they require, aiming to provide more accurate costing information.

  • Acquire knowledge on the core elements of activity-based costing (ABC) and distinguish it from standard costing methods.
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ZK
Zybrea KnightJun 06, 2024
Final Answer :
True
Explanation :
Traditional cost systems allocate costs based on a single overhead rate, usually based on direct labor hours. These systems are simpler to implement and maintain than activity-based costing, which requires identifying and assigning costs to specific activities and then allocating those costs to products or services based on their usage of those activities.