Activity Based Costing: Activity based costing is one of the methods of costing to identify the activities performed to manufacture a product and to allocate the overhead cost of resources or indirect cost to the related products. Indirect cost: Indirect cost is that cost which is related to the multiple activities and therefore it is difficult to identify that cost with the manufacturing of a particular product. To explain: ABC systems only apply to manufacturing companies or not.

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Answer 1

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Chapter 5, Problem 5.12Q

To determine

Activity Based Costing:

Activity based costing is one of the methods of costing to identify the activities performed to manufacture a product and to allocate the overhead cost of resources or indirect cost to the related products.

Indirect cost:

Indirect cost is that cost which is related to the multiple activities and therefore it is difficult to identify that cost with the manufacturing of a particular product.

To explain: ABC systems only apply to manufacturing companies or not.

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Answer 2

Question

Chapter 5, Problem 5.12Q

To determine

Activity Based Costing:

Activity based costing is one of the methods of costing to identify the activities performed to manufacture a product and to allocate the overhead cost of resources or indirect cost to the related products.

Indirect cost:

Indirect cost is that cost which is related to the multiple activities and therefore it is difficult to identify that cost with the manufacturing of a particular product.

To explain: ABC systems only apply to manufacturing companies or not.

Expert Solution & Answer

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Answer 3

Question

Chapter 5, Problem 5.12Q

To determine

Activity Based Costing:

Activity based costing is one of the methods of costing to identify the activities performed to manufacture a product and to allocate the overhead cost of resources or indirect cost to the related products.

Indirect cost:

Indirect cost is that cost which is related to the multiple activities and therefore it is difficult to identify that cost with the manufacturing of a particular product.

To explain: ABC systems only apply to manufacturing companies or not.

Expert Solution & Answer

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Answer 4

Question

Chapter 5, Problem 5.12Q

To determine

Activity Based Costing:

Activity based costing is one of the methods of costing to identify the activities performed to manufacture a product and to allocate the overhead cost of resources or indirect cost to the related products.

Indirect cost:

Indirect cost is that cost which is related to the multiple activities and therefore it is difficult to identify that cost with the manufacturing of a particular product.

To explain: ABC systems only apply to manufacturing companies or not.

Expert Solution & Answer

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Answer 5

Chapter 5, Problem 5.12Q

To determine

Activity Based Costing:

Activity based costing is one of the methods of costing to identify the activities performed to manufacture a product and to allocate the overhead cost of resources or indirect cost to the related products.

Indirect cost:

Indirect cost is that cost which is related to the multiple activities and therefore it is difficult to identify that cost with the manufacturing of a particular product.

To explain: ABC systems only apply to manufacturing companies or not.

Answer 6

Chapter 5, Problem 5.12Q

To determine

Activity Based Costing:

Activity based costing is one of the methods of costing to identify the activities performed to manufacture a product and to allocate the overhead cost of resources or indirect cost to the related products.

Indirect cost:

Indirect cost is that cost which is related to the multiple activities and therefore it is difficult to identify that cost with the manufacturing of a particular product.

To explain: ABC systems only apply to manufacturing companies or not.

Answer 7

Chapter 5, Problem 5.12Q

To determine

Activity Based Costing:

Activity based costing is one of the methods of costing to identify the activities performed to manufacture a product and to allocate the overhead cost of resources or indirect cost to the related products.

Indirect cost:

Indirect cost is that cost which is related to the multiple activities and therefore it is difficult to identify that cost with the manufacturing of a particular product.

To explain: ABC systems only apply to manufacturing companies or not.

Answer 8

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Answer 10

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Answer 11

Ch. 5 - What is broad averaging, and what consequences can...Ch. 5 - Why should managers worry about product...Ch. 5 - What is costing system refinement? Describe three...Ch. 5 - What is an activity-based approach to designing a...Ch. 5 - Describe four levels of a cost hierarchy.Ch. 5 - Why is it important to classify costs into a cost...Ch. 5 - What are the key reasons for product cost...Ch. 5 - Prob. 5.8Q Ch. 5 - Department indirect-cost rates are never...Ch. 5 - Prob. 5.10Q

Solution Summary: The author explains that ABC systems apply to all types of companies, whether it is manufacturing company, service provider, or merchandising company.

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Chapter 5 Solutions