Which category of the ABC hierarchy has costs that are primarily fixed and activities with little or no cause-and-effect relationship with costs?
A) Unit-level
B) Batch-level
C) Organization-sustaining
D) Product-sustaining

Question

Quizplus · Accepted Answer

Organization-sustaining costs are mostly fixed costs that are incurred to support the overall operation of the organization and have little or no cause-and-effect relationship with costs. Examples of organization-sustaining costs include salaries of top-level executives, rent or lease payments for buildings, and utilities expenses.

Which Category of the ABC Hierarchy Has Costs That Are