The MOST Likely Cost Driver of Direct Material Costs Is

question 163

Multiple Choice

The MOST likely cost driver of direct material costs is the:

• A)number of products manufactured.
• B)number of production hours.
• C)number of parts within the product.
• D)number of miles driven.

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Definitions:

Property Taxes

Taxes assessed on real estate properties, based on the property's value, and paid to local governments.

Factory Building

A physical structure used for the manufacturing or assembly of goods.

Period Cost

Costs that are expensed in the period in which they are incurred, not directly tied to production activities.

Committed Fixed Cost

Long-term fixed costs that cannot be easily altered in the short term, such as leases and depreciation on equipment.