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An activity-based costing system is developed in four steps.
a. Compute the allocation rate for each activity.
b. Identify activities and estimate their total costs.
c. Identify the cost driver for each activity and then estimate the quantity of each driver's allocation base.
d. Allocate the indirect costs to the cost object.
Which of the following is the correct order of performing these steps?

Select one:
A. a, b, c, d
B. b, a, c, d
C. b, c, a, d
D. c, a, b, d

Respuesta :

Answer:

C. b, c, a, d

Explanation:

The Costing System includes various stages.

The first stage we need to identify number of activities performed and then find the estimates of the total cost.

In the next stage we need to find the cost driver for each activity and then estimate the quantity of each driver's allocation base.

Then in Next stage we need to solve and compute the allocation rate for each activity.

And Then finally we need to find any Indirect cost applied to cost of the object.

Hence The Sequence would be b, c, a, d.

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