An Activity Measure in Activity-Based Costing Expresses How Much of an Activity

question 187

True/False

An activity measure in activity-based costing expresses how much of an activity is carried out and it is used as the allocation base for assigning overhead costs to departments.

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Definitions:

Producer Surplus

The difference between what producers are willing and able to sell a good for and the actual price they receive, representing the benefit to sellers.

Opportunity Cost

The expense incurred by not choosing the second-best option in any decision-making process.

Higher Prices

An increase in the cost of goods or services in the market.

Quantities

The amount or number of a material or item present or available.