Questions:
1. Explain why conventional cost accounting systems have become less useful in both business and government settings. How does activity-based costing (ABC) reduce the problems created by conventional cost accounting systems?
2. The finance officer of a small city has heard that certain items of cost may be allowable under federal grants, even though they were not incurred specifically for the grant. To what source could the finance officer go to determine what costs are allowable under federal grants?