1. A CPA would recommend implementing an activity-based costing system under which of the following circumstances?
a. The client is a single-product manufacturer.
b. Most of the client's costs currently are classified as direct costs.
c. The client produced products that heterogeneously consume resources.
d. The client produced many different products that homogeneously consume resources.
2. Assume that the inspection activity has an expected cost of $120,000. Expected direct labor hours are 3,000, and expected number of inspections is 600. The best activity rate for moving is as follows:
a. $40 per inspection
b. $40 per hour
c. $200 per inspection
d. $200 per hour