List Two Types of Service Companies That Would Benefit from Using

question 132

Essay

List two types of service companies that would benefit from using activity-based management.For each company listed,state the type of cost information management needs to know.
$$\begin{array} { | l | l | } \hline \text { Type of service company } & \begin{array} { c } \text { Cost information management needs to } \\\text { know }\end{array} \\\hline & \\\hline & \\\hline\end{array}$$

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Definitions:

Predetermined Overhead Rate

A rate calculated before a period begins, used to allocate manufacturing overhead costs to products based on a related activity.

Electrical Motor

A device that converts electrical energy into mechanical energy, commonly used in a wide range of applications from household appliances to industrial machinery.

Standard Labor-Hours

The estimated time that should be required to complete a single unit of production, serving as a benchmark for performance and cost control.

Overhead

The indirect costs of production or operations that are not directly traceable to a specific product or job, such as utilities, rent, and administrative expenses.