Which of the Following Measures Is Not Used by Activity-Based

question 126

Multiple Choice

Which of the following measures is not used by activity-based costing (ABC) systems as an allocation base for allocating overhead costs to the units produced?

• A) Volume-related activities.
• B) Batch-related activities.
• C) Product-related activities.
• D) Need-related activities.

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Definitions:

Total Assets

The sum of all assets owned by an entity, including both current and noncurrent assets, as reported on the balance sheet.

Purchasing Supplies

The act of obtaining materials, goods, or tools needed to operate a business or complete a task.

Assets

Economic resources or items of value owned by an individual or organization, including tangible and intangible resources, that can be used to produce positive economic value.

Liquidity

The ease with which an asset or security can be converted into ready cash without affecting its market price.