Which of the following statements regarding cost drivers is false?
A) Cost drivers can have a motivational effect upon employees.
B) Cost drivers should generally be chosen based on a cause-and-effect relationship between the driver and the specific cost being considered.
C) Cost drivers are groups of overhead costs that are similar.
D) An activity could have more than one potential cost driver.

Question

Quizplus · Accepted Answer

Cost drivers are not groups of overhead costs that are similar, but rather specific activities or factors that cause costs to be incurred.

Which of the Following Statements Regarding Cost Drivers Is False