Which of the Following Is Not a Broad, Cost Classification

question 72

Multiple Choice

Which of the following is not a broad, cost classification category typically used in activity-based costing?

• A) Unit-level.
• B) Batch-level.
• C) Product-sustaining level.
• D) Facility-level.
• E) Management-level.

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Definitions:

Unit Sales

The quantity of products sold by a company, not accounting for any bulk, wholesale, or grouping discounts.

Margin of Safety

The difference between actual sales and the break-even point, indicating the amount by which sales can drop before a business incurs a loss.

Degree of Operating Leverage

Degree of operating leverage measures the sensitivity of a company's operating income to a change in sales volume, indicating the impact on profits from sales fluctuations.

Contribution Format Income Statement

An income statement format that separates variable costs from fixed costs, highlighting the contribution margin.