Facility-sustaining costs are the costs of activities ________.
A) undertaken to support individual products or services regardless of the number of units or batches in which the units are produced
B) related to a group of units of a product or services, rather than each individual unit of product or service
C) that managers cannot trace to individual products or services but that support the organization as a whole
D) performed on each individual unit of a product or service such as the cost of energy, machine depreciation, and repair

Question

Quizplus · Accepted Answer

Facility-sustaining costs are generally fixed costs that support the organization as a whole and cannot be traced to individual products or services. They are incurred regardless of the number of units produced, and include costs such as rent, property taxes, and insurance. Option A describes product-sustaining costs, Option B describes batch-level costs, and Option D describes unit-level costs.

Facility-Sustaining Costs Are the Costs of Activities ________