Which Purpose of Cost Allocation Is Used to Encourage Sales

question 52

Multiple Choice

Which purpose of cost allocation is used to encourage sales representatives to push high-margin products or services?

• A) to provide information for economic decisions
• B) to motivate managers and other employees
• C) to justify costs or compute reimbursement
• D) to measure income and assets for reporting to external parties

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Definitions:

Subjective Measures

Assessments based on personal opinions, interpretations, points of view, or judgments rather than on quantifiable or objective criteria.

Objective Measures

Quantitative indicators used to assess performance or progress in a definitive and unbiased way.

Salesperson's Performance

The assessment of how effectively a salesperson achieves sales targets and contributes to the organization's goals.

Sales Evaluation Criteria

Metrics or standards used to assess the performance of sales activities, including revenue growth, customer acquisition, and profitability.