Asked by Trevia Knight on May 28, 2024
Verified
Activity-based costing can only be used to allocate manufacturing factory overhead.
Activity-Based Costing
A pricing technique that allocates overheads and indirect expenses to associated services and products based on the activities involved.
Manufacturing Factory Overhead
All indirect costs associated with the manufacturing process, excluding direct materials and direct labor expenses.
- Learn the fundamentals and application processes of activity-based costing in assigning factory overhead charges.
Verified Answer
MS
monika sharmaMay 30, 2024
Final Answer :
False
Explanation :
Activity-based costing (ABC) can be used to allocate both manufacturing overhead and non-manufacturing overhead costs, as it assigns costs based on activities that drive costs, not just in manufacturing environments.
Learning Objectives
- Learn the fundamentals and application processes of activity-based costing in assigning factory overhead charges.
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