A Department That Incurs Costs Without Directly Generating Revenues Is

question 35

Multiple Choice

A department that incurs costs without directly generating revenues is a:

• A) Service center.
• B) Production center.
• C) Profit center.
• D) Cost center.
• E) Performance center.

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Definitions:

Activity-based Costing System

An activity-based costing system is an accounting method that assigns costs to products or services based on the activities and resources that go into production, providing more accurate cost information.

Measuring Ingredients

Measuring Ingredients involves quantitatively determining the proportions of various components that go into a product, critical in both cooking and manufacturing.

Batch Level Activities

These activities involve costs incurred for every batch produced, regardless of the volume of units in the batch.

Materials Handling

The movement, protection, storage, and control of materials and products throughout manufacturing, warehousing, distribution, consumption, and disposal.