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True or false- Please explain: In a Capacity Analysis report in time-based activity-based costing, the impact...

True or false- Please explain:

In a Capacity Analysis report in time-based activity-based costing, the impact on expenses of matching capacity with demand is computed by multiplying the potential adjustment in the number of employees by the average salary per employee.

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Answer #1

True

The statement is correct

Under Capacity Analysis in time - based activity - based costing:

Impact on expense of matching capacity = Adjustments in the number of employees X Average salary per employee

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