For an Activity Base to Be Useful in Cost Behavior

question 182

Multiple Choice

For an activity base to be useful in cost behavior analysis

• A) the activity should always be stated in dollars.
• B) there should be a correlation between changes in the level of activity and changes in costs.
• C) the activity should always be stated in terms of units.
• D) the activity level should be constant over a period of time.

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Definitions:

Medieval Times

A historical period in Europe spanning roughly from the 5th to the late 15th century, characterized by feudalism, manorialism, and the prevalence of knights and castles.

Goldsmiths' Safes

traditionally were used by goldsmiths in medieval times to store gold and valuable items, marking an early form of banking.

Financial Institutions

are establishments that provide financial services to its clients or members, including banks, credit unions, insurance companies, and investment firms.

Reserve

Assets held back or saved for future use or to meet unforeseen needs, often referring to banks' reserves of cash.