When a Company Is Choosing Between Different Types of Volume

question 53

Multiple Choice

When a company is choosing between different types of volume based cost drivers, which of the following factors suggest the use of outputs as a cost driver?
i. The company has only one product.
ii. The company is labour intensive.
iii. The company uses large quantities of direct materials.

• A) i
• B) i and iii
• C) ii
• D) ii and iii

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Definitions:

Employee Motivation

The level of energy, commitment, and creativity that a company's workers apply to their jobs.

Perform Successfully

Achieving or exceeding the set goals, standards, or expectations through competence, skill, or knowledge.

Goal Difficulty

The challenge associated with achieving a specific goal, often affecting motivation and performance.

Challenging

Referring to a task or situation that is demanding and tests one's abilities or resources.