If the Total Activity Cost Were Unknown,it Could Be Calculated

question 42

Multiple Choice

If the total activity cost were unknown,it could be calculated by:

• A)dividing the total activity driver by the activity rate.
• B)multiplying the total activity driver by the activity rate.
• C)adding the total activity driver to the activity rate.
• D)subtracting the activity rate from the total activity driver.

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Definitions:

Direct Materials

These are raw materials that can be directly traced to the production of a specific product.

FIFO Method

stands for "First-In, First-Out," an inventory valuation method where the oldest inventory items are recorded as sold first, relevant for cost of goods sold calculation.

Work-In-Process Inventories

Items that are in the process of being produced but are not yet completed, representing a type of inventory for manufacturing companies.

First-In, First-Out Method

An inventory valuation method where the items produced or purchased first are sold or used first.