Which Service Department Cost Allocation Method Assigns Indirect Costs to Cost

question 165

Multiple Choice

Which service department cost allocation method assigns indirect costs to cost objects after considering some of the interrelationships of the cost objects?

• A)step method
• B)indirect method
• C)algebraic method
• D)direct method

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Definitions:

Zero-Base Budgeting

A budgeting approach where every expense must be justified for each new period, starting from a "zero base," with no reference to prior years' budget.

Redundant Activities

Processes or tasks that are unnecessary or duplicative, leading to inefficiency within an organization.

Continued Usefulness

Refers to the ongoing applicability or relevance of an asset, product, or process.

Participative Budgeting

A budgeting process where employees at various levels of an organization are involved in the budgeting decision-making process.