Which of the following statements is incorrect with regard to Activity Based Costing (ABC)? ...
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Accounting
Which of the following statements is incorrect with regard to Activity Based Costing (ABC)?
A.
If the consumption ratios using the traditional method are different from the consumption ratios using ABC, cost distortion will exist.
B.
The choice to use ABC does not impact the calculation of direct product costs.
C.
The costs of implementing ABC are generally lower for companies that have established information technology systems.
D.
ABC recognizes that not all manufacturing overhead activities should be categorized as unit level activities.
E.
ABC uses only volume based cost drivers in the calculation of predetermined manufacturing overhead rates.
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