Chapter C, Problem 7QS

To determine

Requirment-1

To Chose:

The best costing method which tends to overstate the cost of high-volume products, from the below

1. Traditional volume-based costing
2. Activity based costing
3. Job order costing
4. Differential costing

To determine

Requirment-2

To Chose:

The best costing method, if management wants the most accurate product cost,

a. Volume-based costing using direct labor hours to allocate overhead

b. Volume-based costing using a plant wide overhead rate

c. Normal costing a plant wide overhead rate

d. Activity-based costing

To determine

Requirment-3

To Chose:

Then Disadvantages of Activity-based costing from the below,

a. It is not acceptable under GAAP for external reporting

b. It can be costly to implement

c. It can be used in activity-based management

d. Both a. and b.