Which of the Following Statements Concerning Cost Drivers Is Incorrect

question 23

Multiple Choice

Which of the following statements concerning cost drivers is incorrect?

• A) As direct labour shrinks as a proportion of manufacturing costs it becomes a more accurate factor by which to apply overhead to products.
• B) A cost driver is a measure of the activity that causes overhead costs.
• C) In modern day manufacturing there has been a decline in labour costs and an increase in factory overheads as a percentage of product costs.
• D) Inaccurate application of overhead to products can lead to wrong conclusions about which products are profitable.

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Definitions:

Machiavellianism

A personality trait that sees a person so focused on their own interests they will manipulate, deceive, and exploit others to achieve their goals.

Narcissism

A personality trait characterized by an inflated sense of self-importance, need for admiration, and lack of empathy for others.

Primary Caregiver

The main person who provides care and emotional support to a child or dependent individual.

Attachment

A deep and enduring emotional bond that connects one person to another across time and space.