Which of These Is Not a Major Disadvantage of a Leased

question 55

Multiple Choice

Which of these is not a major disadvantage of a leased department to a lessee?

• A) the use of shared facilities and equipment with the leasor
• B) restrictions on days open
• C) restrictions on goods/services offered
• D) leasor refusal to renew the lease

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Definitions:

Activity Cost Pools

A method in cost accounting where costs are accumulated according to activities performed, for allocating overhead costs more accurately to products or services.

Batch-level Activities

Operations or tasks that are performed for each batch of products, regardless of the size of the batch.

Units

Generally refers to the quantitative measure of output or production in business operations.

Predetermined Overhead Rate

An estimated rate used to allocate manufacturing overhead costs to individual products based on a certain activity base, such as labor hours or machine hours.