Question

Which one of the following managerial accounting approaches attempts to allocate manufacturing overhead in a more meaningful fashion?

a) total quality management
b) balanced scorecard
c) activity-based costing
d) just-in-time inventory

Answer 1

Activity-based costing (ABC) is the managerial accounting approach that attempts to allocate manufacturing overhead in a more meaningful fashion.

Step-by-step explanation:

The managerial accounting approach that attempts to allocate manufacturing overhead in a more meaningful fashion is activity-based costing (ABC).

Activity-based costing is a method of allocating manufacturing overhead costs by identifying the activities that drive these costs and allocating them to products or services based on their usage of these activities.

For example, instead of allocating all manufacturing overhead costs evenly across all products, ABC seeks to allocate costs based on the specific activities or resources that are consumed by each product. This provides a more accurate and meaningful picture of the actual costs incurred by each product.