Pace Rentals Has Begun a New System of Allocating Costs

question 131

Multiple Choice

Pace Rentals has begun a new system of allocating costs according to what their employees do, rather than what the company spends. For example, labor expenses are allocated to employee tasks rather than salary and benefits. This practice is referred to as

• A) Cost accounting.
• B) Accounting auditing.
• C) Task accounting.
• D) Activity-based costing.
• E) Allocation costing.

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Definitions:

Valid License

An official permission or permit that meets all legal requirements to engage in a particular activity or profession.

Employment Agreement

An official document outlining the terms and conditions of employment between an employer and employee.

Traditional Rule

A conventional or longstanding guideline or principle that is generally followed within a specific field or context.

Modification of Rule

The process of formally changing or amending a rule or regulation, typically through an established legal or administrative procedure.