Question

Under activity-based costing, selling and administrative expenses are a.allocated to products based on how each product consumes activities. b.allocated to the top-selling products only. c.allocated to all products at the same rate. d.treated as period expenses.

Answer 1

The answer is A.

Step-by-step explanation:

Activity-based costing is a costing method that assigns indirect costs(e.g selling and administrative expenses) to activities based on each product’s use of activities. It focuses attention on cost drivers, the activities that cause costs to increase

It identifies the activities generating costs and assigns costs to those activities.