Which of the Following Costing Activities Is Associated with the Financial

question 24

Multiple Choice

Which of the following costing activities is associated with the financial accounting system?

• A)determining the cost of a department
• B)determining the cost of goods sold for financial statements
• C)preparing budgets
• D)determining the cost of a customer

---

Definitions:

Direct Materials Cost

The expenditure for raw materials that can be directly traced to the production of goods.

Traditional Costing

An accounting method that assigns all manufacturing overhead costs to products based on a predetermined overhead rate, regardless of the activities that generated the costs.

Activity-Based Costing

A costing method that assigns overhead and indirect costs to related products and services based on the activities they require.

Direct Labor-Hours

The total amount of time spent by workers directly involved in the manufacturing activities.