Cost Behavior and Cost-Volume-Profit AnalysisWarren / Reeve / DuchacExercise 19-4 solution |
From the following list of activity bases for an automobile dealership, select the base that would be most appropriate for each of these costs:
(1) preparation costs (cleaning, oil, and gasoline costs) for each car received,
(2) salespersons' commission of 4% of the sales price for each car sold,
(3) administrative costs for ordering cars.
a. Dollar amount of cars sold
b. Number of cars received
c. Dollar amount of cars on hand
d. Number of cars on hand
e. Dollar amount of cars ordered
f. Dollar amount of cars received
g. Number of cars ordered
h. Number of cars sold
For each of the costs, choose the activity base from the list of activity bases that would be the most appropriate.
1. Preparation costs (cleaning, oil, and gasoline costs) for each car received: (B)
2. Salespersons' commission of 4% of the sales price for each car sold: (A)
3. Administrative costs for ordering cars: (G)
