Which of the following is a batch-level cost driver?
A)Output units.
B)Number of employees.
C)Number of orders.
D)Number of parts.
E)Machine hours.

Question

Quizplus · Accepted Answer

Number of orders is a batch-level cost driver because it is a variable that affects the cost of processing a batch of products or services. The cost of processing the orders, such as setup costs, scheduling costs, and quality control costs, increases with the number of orders processed. The other cost drivers listed (output units, number of employees, number of parts, and machine hours) are all at the unit-level or process-level, meaning that they affect the cost of producing each unit or operating each process, rather than the cost of processing batches of units.

Which of the Following Is a Batch-Level Cost Driver