Considering the relationship of variables, the relationship in which the activity cost is included in the dependent variable, which has similar cost driver is classified as __________?
Correct answer: A. homogeneous relationship
- A. homogeneous relationship
- B. extreme relationship
- C. no homogeneous relationship
- D. heterogeneous relationship
Explanation
A homogeneous relationship exists when the dependent cost represents the activity cost associated with the same or a similar cost driver. Heterogeneous costs combine activities driven by substantially different factors.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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