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In Allocating Fixed Costs to Products in Activity-Based Costing

Question 32

Multiple Choice

In allocating fixed costs to products in activity-based costing,


A) direct labor hours should always be used as the allocation base.
B) a company should use the same allocation base that it uses for variable costs.
C) a cost driver that is not volume-related should be used.
D) machine hours should always be used.

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