Multiple Choice
What is the primary drawback to using a volume-driven base,such as direct labor or machine hours,to apply overhead to products in a traditional cost accounting system?
A) The cost accountant may not fully understand how to track direct labor or machine hours.
B) It is difficult for an AIS to incorporate such a measurement into its system.
C) It is difficult for an ERP to incorporate such a measurement into its integrated system.
D) Many overhead costs are incorrectly allocated to products since they do not vary with production volume.
Correct Answer:
Verified
Correct Answer:
Verified
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