Asked by Carly Koncz on Jul 13, 2024
Verified
Which of the following is a cost pool used with the activity-based costing method?
A) total selling and administrative expenses
B) direct materials dollars
C) total factory overhead
D) production setups
Cost Pool
A collection of specific expenses, usually organized by department or service area, used as a basis for assigning costs to products or services.
Direct Materials Dollars
The total cost of all the raw materials used in the production of a product.
- Acquire insight into the mechanism of activity-based costing (ABC) and its essentiality in correctly attributing costs to products.
- Identify distinctions among diverse classes of costs and their importance in distributing costs.
Verified Answer
MZ
Maham zaheerJul 17, 2024
Final Answer :
D
Explanation :
Production setups are a cost pool used in activity-based costing, as they represent a group of costs associated with setting up equipment or machines for production runs, which is an activity that drives costs in this costing method.
Learning Objectives
- Acquire insight into the mechanism of activity-based costing (ABC) and its essentiality in correctly attributing costs to products.
- Identify distinctions among diverse classes of costs and their importance in distributing costs.
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