Which of the Following Reasons Explain Why a Physical-Measure to Allocate

question 122

Multiple Choice

Which of the following reasons explain why a physical-measure to allocate joint costs is less preferred than the sales value at split-off point?

• A) a physical measure such as volume is difficult to estimate than sales value
• B) physical volume usually has little relationship to the revenue producing power of products
• C) a physical measure usually results in less costs being allocated to the product that weighs the most
• D) customers will easily understand that the products are overpriced

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Definitions:

United States

A country in North America, comprising 50 states, known for its significant influence on world politics, economy, and culture.

American Colonization Society

An organization founded in 1816 to assist free black people in emigrating to Africa.

Emigrated

The act of leaving one's country to live in another.

Liberia

A country on the West African coast, established as a colony for freed African American slaves in the 19th century.