Activity Rates in Activity-Based Costing Are Computed by Dividing Costs

question 11

True/False

Activity rates in activity-based costing are computed by dividing costs from the first-stage cost assignments by the activity measure for each activity cost pool.

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Definitions:

Base Pay

The initial rate of compensation that an employee receives in exchange for their services, not including bonuses, benefits, or other forms of additional compensation.

Offshoring

The practice of relocating certain business operations or services to another country, often to reduce costs or access different markets.

Nonlabor Alternative

Options or solutions that do not involve human labor, often involving automation or technology.

Inputs

Resources (such as time, labor, and materials) used in the production process to create goods or services.