Under ABC, Cost Drivers Are Separated into Unit-Based and Non-Unit-Based

question 15

True/False

Under ABC, cost drivers are separated into unit-based and non-unit-based drivers.

---

Definitions:

Total Cost

All expenditures related to the manufacture of goods or provision of services, integrating both unchanging and dynamic costs.

Total Variable Cost

the overall cost that varies directly with the level of production or output.

TC

Typically refers to "Total Cost," which is the complete cost of production including both fixed and variable costs.

Average Fixed Costs

The fixed costs of production (such as rent and salaries) divided by the quantity of output produced.