If a Cell Phone Manufacturer Purchases a Microchip Business, It

question 26

Multiple Choice

If a cell phone manufacturer purchases a microchip business, it creates a(an) :

• A) downstream merger.
• B) horizontal merger.
• C) upstream merger.
• D) conglomerate merger.

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Definitions:

Product Costs

The total costs incurred to produce a product, including direct materials, direct labor, and manufacturing overhead.

Activity-Based Costing

A costing method that assigns costs to products or services based on the activities and resources that go into producing them.

Machine-Hours

A measure of production activity that quantifies the number of hours machines are operated in the manufacturing process.

Activity Rate

A measure used in activity-based costing to assign costs to activities based on their use of resources.