Which of the Following Is an Appropriate Cost Driver for Issuance

question 130

Multiple Choice

Which of the following is an appropriate cost driver for issuance of purchase orders?

• A) Number of units
• B) Number of purchase orders
• C) Number of setups
• D) Either number of units or number of purchase orders would be appropriate

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Definitions:

Productivity

The efficiency of production, measured as the ratio of output to inputs used in the production process.

Marginal Product

Marginal Product refers to the additional output generated by employing one more unit of a particular input, holding all other inputs constant.

Bricklayers

Skilled tradespeople who lay bricks, concrete blocks, stone, and other masonry materials to construct or repair walls, foundations, partitions, and other structures.

Efficiency Wage

A theory suggesting that paying workers a higher wage than the market equilibrium wage can lead to increased productivity and efficiency.