In Implementing an Activity-Based Costing System,after All the Activities Have

question 136

Multiple Choice

In implementing an activity-based costing system,after all the activities have been identified and the appropriate level of detail selected,the activities are combined into activity cost pools based on their

• A)Behavior
• B)Function
• C)Cost drivers
• D)Cost levels

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Definitions:

Variable Costing

A bookkeeping approach that incorporates just the variable costs of production (such as direct materials, direct labor, and variable factory overheads) into the costs of products.

Variable Costing

A costing method that includes only variable production costs—direct materials, direct labor, and variable manufacturing overhead—in product costs, excluding fixed overhead.

Net Operating Income

A measure of a company's profitability from its core business operations, excluding deductions of interest and taxes.

Variable Costing

A costing method that includes only variable manufacturing costs in product costs, treating fixed manufacturing overhead as a period expense.