Question

Activity rates are calculated by a.dividing the budgeted activity cost by the total activity-base usage. b.dividing the total activity-base usage by the budgeted activity cost. c.subtracting the total activity-base usage from the budgeted activity cost. d.multiplying the budgeted activity cost by the total activity-base usage.

Answer 1

Answer: The correct answer is option (A)

Explanation: Activity rates is calculated by dividing the budgeted activity cost by the total activity-base usage.

Activity Rate = (Budgeted Activity cost) ÷ ( total activity base usage)