What is the first step in applying activity-based costing? Why is overhead allocation under ABC usually more accurate than either the plantwide overhead allocation method or the departmental overhead allocation method? Why are direct labor hours and machine hours commonly used as the bases for overhead allocation?

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06-12-2022
Business

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What is the first step in applying activity-based costing? Why is overhead allocation under ABC usually more accurate than either the plantwide overhead allocation method or the departmental overhead allocation method? Why are direct labor hours and machine hours commonly used as the bases for overhead allocation?

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