Department heads at st. claire machine works, a $5‑million metal fabricating company with operations in four states, are meeting to determine both the management responsibilities that they share in common and those that differ according to different functions. they all set goals, allocate resources, motivate employees, and compare results with original goals. marketing oversees sales and advertising, while production handles purchasing, engineering, and fabrication. finance oversees accounting, raising capital, and paying/collecting bills.
each department its work.
(a) advertises
(b) organizes
(c) outsources
(d) audits

Activity-based costing (abc) is not truly a cost collection mechanism as much as it is an inventory valuation method. the main purpose for implementing an activity-based cost system is to try to overcome some of the cost distortions that occur in traditional costing from product differences when there are variations in size and complexity. however, one of the disadvantages of utilizing abc is that the additional information gathering necessary to implement costing with that level of detail might be beyond the reach of some companies with resource or financial constraints. with this in mind, what kinds of industries or companies do you think would benefit most from using activity-based costing and why? in designing or modifying an accounting system to capture appropriate costs for abc, what considerations do you think would need to be made?