The Type of Criteria Used to Select a Cost Driver

question 14

Multiple Choice

The type of criteria used to select a cost driver that is based on using direct labour hours to encourage a reduction in the number of labour hours used is known as:

• A) cause and effect.
• B) behavioural.
• C) ability to bear.
• D) fairness or equity.

---

Definitions:

Inputs

Resources, information, or materials used in a process to produce goods or services, essential for the operational workflow.

Outputs

Outputs are the results or products generated by a system, process, or activity after processing input.

Efficiency

The ratio of the useful output of a system to its input, often used to measure the performance and productivity of a process or system.

Clean Sheet

An approach in design or planning that starts from scratch, without considering prior work or constraints, often referred to as starting with a 'blank slate'.