Final answer:
The correct answer is B. Plant maintenance, which is essential for maintaining the overall operations and capacity of the company without being tied directly to production volumes.
Step-by-step explanation:
The correct answer to the question is B. Plant maintenance. Facility-level activities are those activities required to maintain the physical plant and the overall operations of the company, regardless of how many units are produced or how many services are offered.
Facility-level activities, compared to unit-level, batch-level, or product-level activities in an activity-based costing system, are not tied to the volume of production but are necessary to maintain the business's ongoing capacity to operate. Examples include property taxes, insurance, security, plant depreciation, and plant maintenance. These costs are often considered overhead and are not easily traceable to individual products but are incurred as long as the facility is operational.
Plant maintenance is distinctly a facility-level activity because it's essential to keep the entire operation functional. Unlike activities like materials handling or product inspection, which may vary with production levels, plant maintenance must occur regardless of current production volumes or the variety of products being manufactured. Activities such as design engineering and purchase orders might be more closely related to particular products or production batches and therefore would not be classified as facility-level activities.