Allocation of Service Department Costs to Producing Departments Is the Most

question 79

Multiple Choice

Allocation of service department costs to producing departments is the most complex of the allocation phase of departmental cost allocation because of the likely presence of:

• A)Manager bias.
• B)Formula distracters.
• C)Repetitive steps.
• D)Reciprocal flows.
• E)Non-value adding activities.

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Definitions:

Long-Term Debt

Borrowings that are due for repayment in more than one year's time, used to finance a company's operations beyond its immediate needs.

Marginal Tax Rates

The rate at which the last dollar of income is taxed, reflecting the percentage of tax applied to your income for each tax bracket in which you qualify.

Interest Income

Earnings generated from the lending of money or from deposit funds in interest-bearing accounts.

Eligible Dividends

Dividends designated by a corporation to be eligible for a lower tax rate on the dividend income received by an individual shareholder.