Provide cost information on a timely basis.
Insure transmission of correct data.
Extend the useful life of the cost data.
Adjust for variances in data sources.
UNIT 2 QUIZ
Question 4. Question : The ideal criterion for choosing an
allocation base for overhead is:
Student Answer:
Ease of calculation.
A cause-and-effect relationship.
Ease of use.
Its preciseness.
Question 5. Question : Effective implementation of
activity-based costing (ABC)
requires:
Student Answer:
Normally the assistance of a consultant.
A sophisticated and expensive computer system.
Support of top management and key employees.
Capturing properly the complexity of the data.
ABC has no significant implementation issues.