An Activity- Based Costing System Improves the Allocation of Which

question 19

Multiple Choice

An activity- based costing system improves the allocation of which of the following manufacturing costs?

• A)Direct labour
• B)Indirect manufacturing costs
• C)Direct materials
• D)Sales commissions

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Definitions:

Net Income

The profit of a company after all expenses and taxes have been subtracted from total revenue.

Operating Activities

Transactions and other events related to the core business operations of a company, including revenue and expense transactions that affect the net income.

Investing Activities

Transactions involving the purchase and sale of long-term assets and other investments not included in cash equivalents.

Net Cash Flow

The difference between a company's cash inflows and outflows in a given period.