Asked by Sofia Bernal on Jul 13, 2024

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When activity-based costing is used to apply overhead to products, support department costs are referred to as

A) support activity costs
B) department activity costs
C) multiple activity costs
D) activity-based department costs

Support Activity Costs

Costs associated with activities not directly involved in producing goods or services but necessary for the overall operation.

Activity-Based Costing

A method of accounting that identifies and assigns costs to overhead activities and then assigns those costs to products.

  • Recognize the essentiality and processes for apportioning expenses of support departments to products.
  • Comprehend key aspects and restrictions of activity-based costing (ABC) along with different techniques for overhead distribution.
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Verified Answer

AH
Ameena HaleyJul 16, 2024
Final Answer :
A
Explanation :
Support department costs are referred to as support activity costs in activity-based costing because these costs are associated with activities that support the production process but are not directly tied to a specific product.