Costs drivers can typically be based on output volume or activity. Using volume based drivers to...
Costs drivers can typically be based on output volume or activity.
Using volume based drivers to allocate indirect cost would generally result in more indirect costs being allocated to high volume products.
All of the following are volume based cost drivers, except:
Group of answer choices
Direct labour hours
Time taken to set-up machines
Units of output
Machine hours
Direct material quantity (kg)
Homework Answers
Solution:
All of the following are volume based cost drivers, except "Time taken to set-up machines"
Hence 2nd option is correct.
Add Answer to:
Costs drivers can typically be based on output volume or
activity.
Using volume based drivers to...
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The use of unit-based activity drivers to assign costs can result in significant cost distortions only if: a direct material costs are a small percentage of total manufacturing costs. b. direct material costs are a significant percentage of total manufacturing costs. c. overhead costs are a significant percentage of total manufacturing costs. d. overhead costs are a small percentage of total manufacturing costs. The following information is provided by Zinger Corporation for the year: Actual direct labor hours worked Budgeted...
Activity-Based Costing Slack Corporation has the following predicted indirect costs and cost drivers for 2019 for the given activity cost pools: Fabrication Department Finishing Department Maintenance. ... Materials handling Machine setups Inspections .. $ 20,000 30,000 70,000 $10,000 15,000 5,000 25,000 $55,000 Cost Driver Machine hours Material moves Machine setups Inspection hours $120,000 The following activity predictions were also made for the year: Fabrication Department Finishing Department Machine hours .. Materials moves.. Machine setups Inspection hours. 10,000 3,000 700 5,000...
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