Which formula is used to calculate cost under Activity Based Costing?

CS Executive · Corporate and Management Accounting · PYQS · June 2023
Which formula is used to calculate cost under Activity Based Costing?
(A) Costs = Total Cost of Activity × Activity Cost Driver Rate
(B) Costs = Resources Consumed × Activity Cost Driver Rate
(C) Costs = Resources Consumed / Activity Cost Driver Rate
(D) Costs = Total Cost of Activity / Activity Cost Driver Rate

Answer & Explanation:

Correct Answer: Option (B)

Official answer key: (B).

Topics: Cost Accounting

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