Which of the Following Would Most Likely Be Treated as an Activity

question 231

Multiple Choice

Which of the following would most likely be treated as an activity in an activity-based costing system?

• A) direct labor cost
• B) machine processing
• C) direct materials cost
• D) sales revenues

---

Definitions:

Labor Rate Variance

The difference between the actual labor costs incurred and the expected (or standard) labor costs based on predetermined rates.

Labor Standards

The established benchmarks or expectations for the amount of time and effort required to perform a job or task efficiently.

Operations

The day-to-day activities involved in running a business, especially those related to production, manufacturing, or providing services.

Standard Cost System

An accounting system that uses predetermined costs for products or services to help managers control expenses and analyze operational performance.