The Standard Quantity of Materials Allowed Is Computed by the Equation

question 157

Multiple Choice

The standard quantity of materials allowed is computed by the equation

• A) unit quantity standard *standard output.
• B) unit quantity standard *actual input.
• C) unit quantity standard *standard input.
• D) unit quantity standard * actual output.
• E) not shown here.

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Definitions:

Activity-Based Costing

A technique for determining costs that discerns activities in an organization and charges the cost of these activities to all products and services, based on the real amount each consumes.

Unit Product Cost

The total cost incurred to produce a single unit of product, including direct materials, direct labor, and overhead.

Traditional Costing System

An accounting method that allocates overhead costs to products based on a predetermined rate, typically using a single overhead pool.

Direct Labor-Hours

The cumulative hours put in by workers who are directly engaged in the production process.