The Total Traceable Costs of the Account Billing Activity Centre

question 70

Multiple Choice

The total traceable costs of the account billing activity centre is $245,000. Cost behaviour analysis indicates that fixed costs are $75,000. Activity analysis indicates that the cost driver for account billing activity is the number of lines printed, and the total lines printed is 2,500,000.
-A favourable sales-activity variance means that

• A) managers have been efficient in the implementation of a sales budget.
• B) managers have been effective in accomplishing a planned sales level.
• C) demand for the company product is strong.
• D) the sales force has done an excellent job.

---

Definitions:

Marked Down

Refers to a reduction in the selling price of goods or services, typically to clear inventory or to boost sales.

Sale Price

The final amount at which an item is sold after any discounts or promotions.

Operating Expense

Costs associated with the day-to-day functioning of a business, excluding production costs but including items like rent, utilities, and salaries.

Operating Profit

The profit earned from a firm's core business operations, excluding deductions of taxes and interest.