What are the disadvantages of activity based costing, Managerial Accounting

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Disadvantages of activity based costing

1) It is essentially not the panacea for all ills.

2) It absorbs a lot of resources.

3) Too much emphasis on customer viability can leas to problem such as cheaper product and therefore potentially lower customs segmentation.

4) It may lead to weaker customs segmentation.

5) It takes no account of opportunity cost.

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