Which of the following is the most appropriate cost driver for maintaining parts inventory?
A) Number of parts for a product
B) Direct labor hours
C) Sales dollars
D) Number of setups

Question

Quizplus · Accepted Answer

Maintaining parts inventory is directly related to the number of parts needed for a product. As the number of parts increases, so does the inventory needed to maintain them. Therefore, the number of parts for a product is the most appropriate cost driver for maintaining parts inventory.

Which of the Following Is the Most Appropriate Cost Driver