A primary driver of overhead costs in continuous manufacturing operations is:
A) direct labor dollars.
B) direct labor hours.
C) machine hours.
D) machine maintenance dollars.

Question

Quizplus · Accepted Answer

Overhead costs in continuous manufacturing operations are primarily driven by the use of machines, not direct labor. Therefore, the best choice is C, machine hours. Machine maintenance dollars may be a factor, but this would be a subset of the overall machine hours cost. Direct labor dollars and hours may contribute to overhead, but they are not the primary driver.

A Primary Driver of Overhead Costs in Continuous Manufacturing Operations