Item$23$

$3\mathrm{.}34$points

Time Remaining $56$ minutes $34$ seconds

$00$:$56$:$34$

eBook

Item $23$

Time Remaining $56$ minutes $34$ seconds

$00$:$56$:$34$

Which of the following statements is true with regard to activity$-$based costing?

Multiple Choice

The basic principle underlying activity$-$based costing is that activities are what cause overhead cost to be incurred.

Activity$-$based costing rates are the same as departmental overhead rates.

Activity rates are computed by dividing budgeted activity usage by budgeted activity cost.

Activity$-$based costing often results in low$-$volume complex products being undercosted, and high$-$volume simpler products being overcosted.

All cost drivers used to determine the rates will be unit$-$level drivers.