The Activity That Causes Changes in the Behavior of Costs

question 186

Multiple Choice

The activity that causes changes in the behavior of costs is referred to as the activity

• A) index.
• B) multiplier.
• C) element.
• D) correlation.

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Definitions:

Cost Center

A department or unit within a business where costs are incurred, but which does not directly generate revenue.

Actual Costs

The true, realized expenses incurred during the production of goods or services, as opposed to estimated or projected costs.

Decentralized Operations

is an organizational structure where decision-making and operational responsibilities are delegated to individual departments or locations.

Support Department

A department that provides a necessary service to produce a product but is not directly involved in the production process. Also known as a service department.