Which of the four levels of the cost hierarchy would be used by a ice cream producer using an activity-based management for a production run of a certain quantity of ice cream of vanilla flavor?
A)Unit-level activity
B)Batch-level activity
C)Product-level activity
D)Facility-level activity

Question

Quizplus · Accepted Answer

Batch-level activity, as it involves activities related to producing a certain quantity of ice cream, such as setting up equipment, mixing ingredients, and packaging. Unit-level activity would involve activities related to producing each individual ice cream, which would not be efficient for a production run. Product-level activity would be more appropriate for costs related to product design or advertising. Facility-level activity would involve costs related to the entire facility, such as rent or utilities.

Which of the Four Levels of the Cost Hierarchy Would