Which of the following is FALSE about allocating overhead using activity-based c

Question

Which of the following is FALSE about allocating overhead using activity-based costing overhead rates? You need to know the budgeted overhead amount for each activity pool to compute the predetermined overhead rate for that activity. O A You need to know the budgeted cost driver amount for each activity to compute the predetermined overhead rate for that activity. O B You need to know the actual overhead amount for each activity pool to allocate overhead to that activity. You need to know the actual cost driver amount for each activity to allocate overhead to that activity.

Explanation / Answer

Ans: B: Budgeted cost driver amount for each activity is not mandatory in ABC costing. This will work based on the budgeted overhead amount for activity pool to compute the predetermined overhead rate.

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