Which of the following quantities is an example of an activity cost driver in activity-based costing?
A)number of direct labour hours
B)number of labour transactions
C)number of machine hours
D)all of the above

Question

Quizplus · Accepted Answer

Activity cost drivers are the factors that cause the cost of an activity to increase or decrease. They can be any measurable factor that is directly related to the consumption of resources for an activity. The number of direct labor hours, number of labor transactions, and number of machine hours are all examples of activity cost drivers in activity-based costing. Therefore, the best choice is D, as all of the above options are examples of activity cost drivers.

Which of the Following Quantities Is an Example of an Activity