Question

The activity-based costing system:

A. is more appropriate method of cost accounting for rigid hierarchical organizations.

B. effectively departmentalizes an organization based on its core functions such as human resources, purchasing, and maintenance.

C. provides a more accurate picture of how costs should be charged to products and services.

D. assumes that organizations are bureaucratic "machines" that can be separated into component functions.

E. fails to allocate costs across business processes and is less effective than traditional methods of cost accounting.

Answer 1

The activity-based costing system provides a more accurate picture of how costs should be charged to products and services.

Step-by-step explanation:

The activity-based costing system is a method of cost accounting that provides a more accurate picture of how costs should be charged to products and services. It does not assume that organizations are bureaucratic 'machines' that can be separated into component functions.