Which of the following should have the strongest cause and effect relationship with overhead costs?
A) Cost followers.
B) Non-value-added costs.
C) Cost drivers.
D) Value-added costs.
E) Units of output.

Question

Quizplus · Accepted Answer

Cost drivers have the strongest cause and effect relationship with overhead costs because they are the activities or factors that directly cause a cost to occur. Identifying and managing cost drivers can significantly impact the control and reduction of overhead costs.

Which of the Following Should Have the Strongest Cause and Effect