The cost hierarchy divides costs into unit-, batch-, product-, and facility-level costs.

Question

Quizplus · Accepted Answer

The cost hierarchy is a commonly used method for organizing costs into different levels or categories. These categories include unit-level costs (costs incurred for each unit produced or sold), batch-level costs (costs incurred for each batch of units produced), product-level costs (costs incurred for each product type or line), and facility-level costs (costs incurred for operating the entire facility or organization).

The Cost Hierarchy Divides Costs into Unit-, Batch-, Product-, and Facility-Level