Activity-Based Costing for Selling and Administrative Expenses Can Also Be

question 76

Multiple Choice

Activity-based costing for selling and administrative expenses can also be beneficial in allocating expenses to various products.Which of the following is the best allocation base for help desk costs?

• A) Number of calls
• B) Square footage of the help desk office
• C) Number of products sold
• D) Number of sales employees

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Definitions:

Owner Withdrawals

Money or assets taken out of a business by the owner(s) for personal use.

Owner's Equity

The residual interest in the assets of a company after deducting liabilities, representing the ownership interest of shareholders or owners.

Adjusted Trial Balance

A list of all the accounts of a company, showing the balance of each after adjustments have been made for errors, omissions, or accruals.

Current Assets

Assets that are expected to be converted into cash, sold or used up within one year or within the entity's operating cycle, whichever is longer.