MA Chapter 15 Questions Alternative Cost Accounting

October 9, 2022 at 9:50 am

Isn’t activity based costing a form of absorbing variable overheads? (because in ABC, we decide on the reason we are incurring these overheads for example the no. of deliveries received and I believe we can only decide on a reason for incurring overheads costs if they are variable overheads) so how does it say in the explanation of answer 2 that ABC doesn’t avoid over or under absorption of fixed overheads BECAUSE it’s a form of absorption costing and therefore involves apportionment? isn’t this reasoning wrong?

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mannannagpal says
October 9, 2022 at 9:50 am
Isn’t activity based costing a form of absorbing variable overheads? (because in ABC, we decide on the reason we are incurring these overheads for example the no. of deliveries received and I believe we can only decide on a reason for incurring overheads costs if they are variable overheads) so how does it say in the explanation of answer 2 that ABC doesn’t avoid over or under absorption of fixed overheads BECAUSE it’s a form of absorption costing and therefore involves apportionment? isn’t this reasoning wrong?
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Sahaijsjsjaioafnn says
October 1, 2020 at 8:44 am
I got 80%. Thanks opentuition.?
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