-Refer to Table 3-2

question 168

Multiple Choice

-Refer to Table 3-2. What is the opportunity cost of 1 kilogram of potatoes for the rancher?

• A) 4 hours of labour
• B) 5 hours of labour
• C) 2-3 pounds of meat
• D) 3/2 pound of meat

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Definitions:

Overhead Accounts

Accounts that track the indirect costs of production or services, such as utilities and rent.

Resource Consumption

The process of using up resources, such as raw materials, labor, and energy, in the production of goods and services.

Manufacturing Overhead

Manufacturing overhead encompasses all production costs except direct labor and direct materials used in manufacturing.

Activity-Based Costing

A costing method that assigns overhead and indirect costs to specific activities, providing more accurate costs of producing specific products or services.