If Activity-Based Costing Is Used,what Type of Activity Would Product

question 120

Multiple Choice

If activity-based costing is used,what type of activity would product inspections be classified as?

• A)unit-level activity
• B)batch-level activity
• C)product-level activity
• D)facility-level activity

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Definitions:

Variable Costing

An accounting method that only includes variable production costs—costs that change with production volume—in the cost of goods sold.

Fixed Costs

Expenses that do not change with the level of goods or services produced by a business within a certain range of activity.

Cost of Goods Manufactured

The total production cost of goods completed during a specific period, including materials, labor, and overhead.

Variable Costing

An accounting method that considers only variable costs as product costs and treats fixed costs as period costs.