Answer:
D) All of these answers are correct
- A. Reveal activities that can be eliminated
- B. Help control nonfinancial items such as number of setup hours
- C. Help identify new designs to reduce costs
Explanation:
Activity based management (ABM) works with activity based costing (ABC) in order to evaluate the performance of different business activities. ABM uses ABC to perform a value chain analysis in order to determine what activities can be eliminated and what processes must be redesigned in order to reduce costs. ABM basically represents a re-engineering process that focuses on cost reduction.
