Advanced Technology Products Produces 10 Different Fastners

question 156

Multiple Choice

Advanced Technology Products produces 10 different fastners. Each time a type of fastener is produced, the equipment must be stopped and items such as filters and drill bits must be changed, oil must be added to the equipment and some parts need lubrication. This work must be done before the products can be produced, the costs related to this activity would be part of which cost pool?

• A) Output-level costs
• B) Batch-level costs
• C) Product-sustaining costs
• D) Service-sustaining costs

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Definitions:

Quality Control

Procedures and standards implemented to ensure that products or services meet specific requirements and are of consistent quality.

Cost Element

A component that categorizes costs according to their nature, involved in the cost accounting process to allocate expenses accurately.

Office Salaries

Expenses related to the wages and salaries of administrative and managerial staff in an office setting.