Which one of the following activities is appropriate as a cost driver for material handling costs?
A)Number of direct labor hours used
B)Number of machine hours used
C)Number of raw material moves
D)Number of units produced

Question

Quizplus · Accepted Answer

Material handling costs are directly related to the amount of movement of raw materials, finished goods, and work in progress. Therefore, the number of raw material moves represents an appropriate cost driver for material handling costs. Choices A, B, and D do not relate directly to material handling costs.

Which One of the Following Activities Is Appropriate as a Cost