Clint Smith Operates a Machine Shop in Burbank,California

question 42

Multiple Choice

Clint Smith operates a machine shop in Burbank,California.He places bids on small lot production projects submitted by firms throughout the Los Angeles area.Which of the following is most likely to be a cost driver for the allocation of utility costs?

• A) Number of units produced
• B) Number of labor hours
• C) Number of projects completed
• D) Sales revenue

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Definitions:

Financing Activities

Transactions involving raising capital and repaying investors, including issuing equity or debt, and dividend payments.

Common Stock

Equity ownership in a corporation, with voting rights and potential dividends, not having preference over preferred stock in bankruptcy proceedings.

Cash Dividend

Dividend that is paid in cash.

Long-Term Debt

Financial obligations of a business or individual that are due more than one year in the future.