Which is not a task typically associated with ABC systems?

Question

BlackTom AI · Accepted Answer

Activity-Based Costing (ABC) assigns costs to specific activities and then to products or services based on their consumption of those activities, rather than aggregating all overhead into one broad rate.

Relevant knowledge points and concepts:
- Activity identification: list the distinct activities that consume resources (e.g., setup, inspection).
- Cost pools: accumulate resource costs for each activity.
- Cost drivers: select measurable factors that cause activity costs (e.g., number of setups, inspection hours).
- Activity rates: compute each activity’s rate = (cost in activity pool) / (total driver quantity).
- Cost tracing: assign activity costs to products/services using activity rates and the product’s driver usage.
- ABC is used to improve costing accuracy and support process improvement and pricing decisions.

Step-by-step reasoning/process:
1. Identify and list activities that consume resources.
2. Collect and assign resource costs to activity cost pools (e.g., salaries, machine costs).
3. Choose appropriate cost drivers for each activity (drivers should reflect cause-and-effect).
4. Calculate activity rates: for each activity, divide the total cost in its pool by the total driver units. Example: If inspection costs = $50,000 and total inspection hours = 2,000, inspection rate = $50,000 / 2,000 = $25 per inspection hour.
5. Assign costs to products/services by multiplying activity rates by the amount of driver each product uses (e.g., product A used 10 inspection hours → $250 assigned).
6. Use resulting costing information for pricing, profitability analysis, and process improvement.

Why “applying a single cost rate” is not correct for ABC:
- Applying a single cost rate (for example, one plant-wide overhead rate) is the hallmark of traditional costing systems, not ABC. ABC explicitly rejects one aggregated rate in favor of multiple activity-specific rates to better reflect resource consumption patterns.

Why other tasks would be incorrect choices:
- Tasks such as identifying activities, assigning costs to activity pools, selecting cost drivers, calculating activity rates, and tracing costs to products are central to ABC and thus would be typical ABC tasks.

Conclusion:
Because ABC builds multiple activity-based rates and assigns costs via activity drivers rather than using one single cost rate, the correct answer is “applying a single cost rate,” which matches the provided answer.

Which is not a task typically associated with ABC systems?单项选择题

类似问题

Use the same information as in Question 1. The product’s direct materials cost is $18.40 per unit and its direct labor cost is $13.60 per unit. According to the activity-based costing system, the average cost per unit of product K27 is closest to:

Which is not a step in activity-based costing?

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