Chapter 10: Activity-Based Costing

Question 1

A method of attributing overhead costs to products based on measurable factors that relate to activities that create overhead costs

Answer 1

Activity-Based Costing (ABC)

Question 2

Activities that take place in order to support a batch or production run, regardless of the size of the batch

Answer 2

Batch-level Activities

Question 3

Numerical measure used to reflect the amount of specific cost that is associated with a particular activity

Answer 3

Cost Drivers

Question 4

Total cost being generated by a specific overhead cost activity

Answer 4

Cost Pool

Question 5

Activities necessary to have a facility in order to participate in the development and production of products or services; activities are not related to any particular line of products or services

Answer 5

Facility Support Activities

Question 6

Activities that take place in order to support a product line, regardless of the number of batches or individual units produced

Answer 6

Product-Line Activites

Question 7

Activities that take place each time a unit of product is produced

Answer 7

Unit-level Activities