Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

1. Introduction to Accounting

Types of Accounting

Financial Accounting

1. Introduction to Accounting

Types of Accounting

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Multiple Choice

In Activity-Based Costing (ABC), any event that causes the consumption of overhead resources is known as a(n):

cost pool

activity driver

cost object

cost driver

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Verified step by step guidance

Understand the concept of Activity-Based Costing (ABC): ABC is a method of allocating overhead costs based on activities that drive costs, rather than using a single allocation base like direct labor hours or machine hours.

Define the term 'cost driver': A cost driver is any factor or event that causes the consumption of overhead resources. It is used to assign costs to activities in ABC.

Differentiate between the terms: 'cost pool,' 'activity driver,' and 'cost object': A cost pool is a grouping of individual costs, typically by department or activity. An activity driver is a measure of the frequency or intensity of a demand placed on an activity. A cost object is anything for which a cost is measured, such as a product or service.

Relate the definition of 'cost driver' to the problem: Since the question asks for the term that represents an event causing the consumption of overhead resources, the correct term is 'cost driver,' as it directly aligns with the definition provided.

Confirm understanding: Ensure that the student understands why 'cost driver' is the correct answer by reviewing the definitions and their applications in Activity-Based Costing.