BUS 371 CH 2 Key Terms

Question	Answer
Activity	An event that causes the consumption of overhead resources in an organization.
Activity-based absorption costing	A costing method that assigns all manufacturing overhead costs to products based on the activities performed to make those products.
Activity cost pool	A “bucket” in which costs are accumulated that relate to a single activity measure in an activity-based costing system.
Activity measure	An allocation base in an activity-based costing system; ideally, a measure of the amount of activity that drives the costs in an activity cost pool.
Batch-level activity	An activity that is performed each time a batch is handled or processed, regardless of how many units are in the batch. The amount of resources consumed depends on the number of batches run rather than on the number of units in the batch.
Product-level activity	An activity that relates to specific products and typically must be carried out regardless of how many batches are run or units of product are produced and sold.

Resource summary

	Created by Jamie Plym over 2 years ago