In an Activity-Based Costing System, Both Organisation-Sustaining and Facility-Sustaining Activities

question 97

True/False

In an activity-based costing system, both organisation-sustaining and facility-sustaining activities are assumed to be unaffected by the number of customers.

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Definitions:

Average Tax Rate

The total amount of tax paid divided by taxable income.

Taxes

Mandatory financial charges or levies imposed by a government on individuals, entities, or transactions to fund public expenditure.

Taxpayer

An individual or entity obligated to pay taxes to a federal, state, or local government body.

Operating Working Capital

Represents the cash used in the day-to-day operations of a business, excluding non-cash assets and liabilities.