Engineered costs result from a cause-and-effect relationship between the cost driver output and the resources used to produce that output.

Question

Quizplus · Accepted Answer

Engineered costs are costs that are directly linked to a specific activity or output. The cost driver output and the resources used to produce that output have a cause-and-effect relationship. This means that as the level of activity or output increases or decreases, the level of resources used and the resulting costs will also increase or decrease in a predictable manner. Therefore, the statement is true.

Engineered Costs Result from a Cause-And-Effect Relationship Between the Cost