Which of the Following Is Not a Benefit of Cost

question 18

Multiple Choice

Which of the following is not a benefit of cost allocation?

• A) Instilling responsibility for all costs of the company in division managers.
• B) Constructing performance measures that may be more meaningful than contribution margins.
• C) Relating indirect costs to contracts, jobs and products.
• D) Additional bookkeeping costs incurred to provide cost allocation information.

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Definitions:

Liability

The legal responsibility for one's actions or omissions, potentially resulting in the requirement to compensate for damage or loss.

Constructive Trust

An equitable trust that is imposed in the interests of fairness and justice when someone wrongfully holds legal title to property.

Indemnification

A legal obligation to compensate for loss, damage, or liability incurred by another party.

Breach

The violation or breaking of a law, duty, or contractual obligation.