An activity center is an organizational unit
A)that makes a single product or performs a single service.
B)in which only value-added activities are performed.
C)that incurs only unit,batch,or product/process level costs.
D)for which management wants separate activity information.

Question

Quizplus · Accepted Answer

An activity center is a separate organizational unit that management wants separate activity information for. Option A is incorrect as an activity center may perform multiple services or produce several products. Option B is incorrect as non-value-added activities may also be performed in an activity center. Option C is incorrect as activity centers also incur facility level costs.

An Activity Center Is an Organizational Unit