A company should consider using ABC if: (a) overhead costs constitute a small portion of total product

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A company should consider using ABC if:

(a) overhead costs constitute a small portion of total product costs.

(b) it has only a few product lines that require similar degrees of support services.

(c) direct labor constitutes a significant part of the total product cost and a high correlation exists between direct labor and changes in overhead costs.

(d) its product lines differ greatly in volume and manufacturing complexity.

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Financial And Managerial Accounting

ISBN: 9781118004234

1st Edition

Authors: Donald E. Kieso, Paul D. Kimmel, Jerry J. Weygandt

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Question Posted: Feb 15, 2024 09:01 AM

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A company should consider using ABC if: (a) overhead costs constitute a small portion of total product

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Financial And Managerial Accounting

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