Economics · Activity Based Costing
Which of the following statements relating to activity-based costing (ABC) is correct?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Activity-based costing cannot be used to cost service industries.
- 2Activity-based costing avoids assigning any overhead costs.
- 3Activity-based costing is a form of absorption costing.✓
- 4Activity-based costing is exactly identical to traditional volume-based costing.
Correct answer
Activity-based costing is a form of absorption costing.
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