RAC Associates Is a Car Rental Company That Rents Cars

question 62

Multiple Choice

RAC Associates is a car rental company that rents cars to customers in the United States. The company uses controls and procedures to prevent car theft. Such procedures are examples of ________.

• A) primary business processes
• B) core activities
• C) strategic activities
• D) supporting business processes

---

Definitions:

Fixed Overhead

The costs associated with running a business that do not vary with the level of production or sales, such as rent, salaries, and insurance.

Variable Overhead

Costs that vary with the level of production or business activity, such as utilities or materials, in contrast to fixed overhead costs.

Direct Labor

The wages or costs associated with workers who are directly involved in the manufacturing or production of goods or services.

Direct Materials

Raw materials that are directly attributed to the production of a product and are easily traceable to the manufacturing process.