“32. Which of the following situations would result in activity-based costing not being beneficial to an entity? a. Products differ substantially in volume, lot size, or complexity of manufacture. b. A high statistical correlation exists between direct labor and the incurrence of overhead costs. c. Top management and marketing people use the new data to cost products more accurately and reflect a more approprtate selling price for its products. d. Products differ substantially in their need for various activities such as setups, inspections, and so forth, involved in the manufacturing process.”

“32. Which of the following situations would result in activity-based costing not being beneficial to an entity? a. Products differ substantially in volume, lot size, or complexity of manufacture. b. A high statistical correlation exists between direct labor and the incurrence of overhead costs. c. Top management and marketing people use the new data to cost products more accurately and reflect a more approprtate selling price for its products. d. Products differ substantially in their need for various activities such as setups, inspections, and so forth, involved in the manufacturing process.”

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