Rosen, Inc., an appliance manufacturer, is developing a new line of ovens that uses controlled-laser technology. The research and testing costs associated with the new ovens is said to arise from a:
A) unit-level activity.
B) batch-level activity.
C) product-sustaining activity.
D) facility-level activity.
E) competitive-level activity.

Question

Quizplus · Accepted Answer

Product-sustaining activities are those that support the entire product line but are not tied to the production of any specific unit or batch. The research and testing costs for developing a new line of ovens would support the entire line of ovens, not just individual units or batches, making it a product-sustaining activity.