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Question(s) / Instruction(s):

An activity-based costing system that is designed for internal decision-making will not conform to generally accepted accounting principles because:

a)            Some manufacturing costs (i.e., the costs of idle capacity and organization-sustaining costs) will not be assigned to products.

b)            Some non-manufacturing costs are assigned to products.

c)            first-stage allocations may be based on subjective interview data.

d)            All of the above are reasons why an activity-based costing system that is designed for internal decision-making will not conform to generally accepted accounting principles.


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