Which of the following would most likely be treated as an activity in an activity-based costing system?
A) direct labor cost
B) machine processing
C) direct materials cost
D) sales revenues

Question

Quizplus · Accepted Answer

An activity-based costing system focuses on identifying and measuring the costs of individual activities that consume resources to produce products or services. Machine processing is an example of an activity that consumes resources (such as electricity, maintenance, and repair) and therefore would be treated as an activity in an activity-based costing system. Direct labor and direct materials would typically be traced directly to the products or services they help produce, while sales revenues are not a cost and would not be relevant in this context.

Which of the Following Would Most Likely Be Treated as an Activity