Question

Activity-based costing is:
A) the process of identifying all activities and relating these activities to the events, circumstances, or conditions that create or drive the need for the activities and the resources consumed.
B) a method of determining the most favorable decision alternative by using activities as the basis on which to build the cost proposal.
C) an approach to cost assignment in which all operating activities are identified, costs are accumulated by those activities, and after nonvalue-adding activities are dealt with, costs are assigned based on the appropriate activity base.
D) an approach to product costing in which most costs are eliminated.

Answer 1

is a way to allocate the overhead cost based on the activities that consumes resources.