Comparing Traditional Costing & Activity-Based Costing


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question 1 of 3

What is a traditional costing system?

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1. Which of the following is included in the activity cost pool?

2. Why is activity-based costing more effective than traditional costing?

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About This Quiz & Worksheet

This quiz and printable worksheet will test your understanding of activity-based and traditional costing systems. Practice questions will ask you to define traditional costing and components of cost systems, as well as compare tradition and activity-based systems.

Quiz & Worksheet Goals

You will encounter these topics in this quiz:

  • Definition of traditional costing system
  • Examples of activities
  • Cost driver
  • Traditional vs. activity-based costing
  • Activity cost pool

Skills Practiced

This work presents a chance to showcase your ability in:

  • Defining key concepts - ensure that you can accurately define main phrases, such as cost driver and traditional costing system
  • Distinguishing differences - compare and contrast topics from the lesson, such as traditional and activity-based costing systems
  • Interpreting information - verify that you can read information regarding activity cost pools and interpret it correctly
  • Knowledge application - use your knowledge to answer questions about examples of activities

Additional Learning

Continue learning about this topic by taking a look at the supplementary lesson titled Comparing Traditional Costing & Activity-Based Costing. Goals covered within this lesson include:

  • Define activity, activity cost pool, costing system, and relevant terminology
  • Understand the differences between traditional and activity-based costing systems
  • Relate what you learn in this lesson to realistic business scenarios
  • Explain the possible failings of traditional costing systems