Services Can Be Classified According to Whether They Are Delivered

question 325

Multiple Choice

Services can be classified according to whether they are delivered by people or equipment,whether they are for profit or nonprofit organizations,and whether they are __________.

• A)government agencies
• B)a national organization or a global organization
• C)privately owned or publicly owned
• D)performed by independent contractors
• E)owned by individuals or corporations

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Definitions:

Activity-Based Costing

A costing method that allocates overhead and indirect costs to related products and services based on their usage of resources.

Lower-Cost Materials

This refers to choosing materials that are less expensive without significantly compromising on quality, often to reduce production costs.

Activity Rate

refers to the cost driver rate that is used in activity-based costing to allocate costs to products or services.

Indirect Labor

Labor costs associated with workers who assist in the production process but do not directly contribute to the manufacturing of the product.