Which activity level does the use of indirect materials best correspond to in Activity Based Costing?

In Activity-Based Costing (ABC), indirect materials are best associated with the Facility Level activity. This is because indirect materials, such as cleaning supplies, lubricants, or small tools, support the overall production environment but are not directly tied to a specific product or batch. These materials are necessary for maintaining the facility's operations and thus are allocated to the overall facility rather than to individual units or batches.

Unit Level activities refer specifically to costs that occur with each individual unit of production, such as direct materials and labor. Batch Level activities are associated with costs that occur due to the creation of a batch of goods but are not incurred for each unit within that batch. Product Level activities pertain to costs related to specific product lines, such as design or advertising expenses, rather than the general overhead required to maintain production.

Thus, when considering the nature of indirect materials and their role in the operational infrastructure of a facility, it's clear that they align more closely with the Facility Level of activity in ABC.