Kaplan and Cooper believe that the information given to managers can be misleading if overhead costs are allocated based on volume of output such as direct labour hours. Which one of the following is not the reason behind this argument?

Question

Accepted Answer

The allocation method ignores the fact that the increased use of technology and automated production processes decreases the overall overhead costs

Answer

The allocation method discriminates high volume products and favours low-volume products

Answer

The allocation method ignores the fact that labour has become a less significant element in the total manufacturing cost

Answer

The allocation method ignores the fact that overhead has become a more significant element in the total manufacturing cost

Crowdly

Kaplan and Cooper believe that the information given to managers can be misleadi...

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