A Critical Evaluation of Traditional Absorption Costing and Activity-Based Costing in Business Management
The most significant disadvantage is that the system relies on one allocation base, and the product costs cannot be appropriately reflected. For instance, such high-volume products could be overcosted because the price might need to appropriately reflect the complexity of production workers or other resources. On the other hand, low-quantity products may be undervalued, leading ... Read More
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