In a Pure Activity-Based Cost System, Which of the Following

question 64

Multiple Choice

In a pure activity-based cost system, which of the following might be treated as period costs?

• A) facility-level costs
• B) product-level costs
• C) batch-level costs
• D) unit-level costs

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Definitions:

Materials Price Variance

The difference between the actual cost of direct materials used in production and the expected (budgeted) cost of those materials.

Materials Standards

Predetermined benchmarks for the cost and quantity of materials used in the production process.

Materials Price Variance

The difference between the actual cost of materials and the expected (or standard) cost, indicating how efficiently materials are being purchased.

Standard Price

A predetermined price that a company aims to pay for materials, labor, and other costs, used for budgeting and performance evaluation.