Which of the Following Statements Is False Regarding the Identification

question 67

Multiple Choice

Which of the following statements is false regarding the identification of activities in activity-based costing (ABC) ?

• A) The identification of activities that drive overhead costs is done before cost drivers are selected.
• B) An activity can be thought of as a procedure or process that causes work to be accomplished.
• C) Each type of overhead cost should be traced to only one activity.
• D) An activity that drives overhead costs can occur outside the physical manufacturing facility.

---

Definitions:

Market Price

The present cost at which a service or asset is available for purchase or sale.

Put Contract

A financial contract that gives the holder the right, but not the obligation, to sell a certain amount of an underlying asset at a specified price within a specific time period.

Stock Price

The cost of purchasing a share of a company, which fluctuates based on supply and demand, company performance, and market conditions.

American Call Option

A type of options contract that gives the holder the right, but not the obligation, to buy a specified asset at a specified price on or before a specified date.