If Activity-Based Costing Is Used, Modifications Made by Engineering to the Product

question 171

Multiple Choice

If activity-based costing is used, modifications made by engineering to the product design of several products would be classified as a

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

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Definitions:

Income Statement

A financial statement that shows a company’s revenue and expenses over a specific period, determining its profit or loss.

Expense Accounts

Accounts used in accounting to track the consumption of economic resources or the incurrence of liabilities in the operation of a company.

Credits

Entries made on the right-hand side of an account, representing gains or increases in liabilities, income, or equity.

Debit

An accounting entry that results in either an increase in assets or a decrease in liabilities on a company's balance sheet.