Answered: 1.An activity that has a direct…

1.An activity that has a direct cause-effect relationship with the resources consumed is a(n) Group of answer choices cost driver overhead rate cost pool product activity

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

1.An activity that has a direct cause-effect relationship with the resources consumed is a(n)

Group of answer choices

cost driver

overhead rate

cost pool

product activity

Definition Definition Indirect costs incurred while producing goods or services. Overhead costs cannot be directly attributed to products or services. Overhead includes indirect material cost, indirect labor cost, rent, utilities expenses, and depreciation. Since these costs directly affect the profitability of a company, managing overhead becomes an important task for management.

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