If All Resources Used in the Production of a Product

question 186

Multiple Choice

If all resources used in the production of a product are increased by 10 percent and output increases by less than 5 percent, then the firm is experiencing

• A)economies of scale.
• B)diseconomies of scale.
• C)constant returns to scale.
• D)decreasing average total costs.

Compute activity rates under activity-based costing system.

Determine the overhead cost assigned to products under activity-based costing system.

Understand the impact of costing methods on product cost determination.

Analyze the difference in overhead per unit and unit product costs between traditional and activity-based costing.

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Definitions:

Supervisors

Individuals within an organization who oversee and manage the work of other employees, ensuring tasks are completed efficiently and effectively.

Union Workers

Employees who are members of a labor union, which represents them in negotiations with employers over wages, benefits, and working conditions.

Productive

Relates to the capability of producing a significant amount or result, especially in terms of work or economy.

Nonunion Workers

Employees who are not members of a labor union and do not receive the collective bargaining advantages that unionized workers might have.