The Following Tasks Are Associated with an Activity-Based Costing System

question 2

Multiple Choice

The following tasks are associated with an activity-based costing system:
1- Assignment of cost to products
2- Calculation of pool rates
3- Identification of cost drivers
4- Identification of cost pools
Which of the following choices correctly expresses the proper order of the preceding tasks?

• A) 1, 2, 3, 4.
• B) 2, 4, 1, 3.
• C) 3, 4, 2, 1.
• D) 4, 2, 1, 3.
• E) 4, 3, 2, 1.

---

Definitions:

Bushels

A unit of volume commonly used in agriculture, particularly in the United States, for measuring quantities of grain, fruits, and other dry commodities.

Price

The amount of currency needed to buy a good or service.

Profit

The financial gain realized when the amount of revenue earned from business activities exceeds the expenses, costs, and taxes needed to sustain the operation.

Production Function

A mathematical representation showing the relationship between inputs used in production and the output generated from those inputs.