Dual Allocation Is a Cost Allocation Approach That Separates Direct

question 41

Multiple Choice

Dual allocation is a cost allocation approach that separates direct and indirect costs, tracing the direct costs directly to the cost object that:

• A)Can bear the cost.
• B)Relates best to the cost.
• C)Is first identified with the cost.
• D)Caused the cost.
• E)Is most impacted by the cost.

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Definitions:

Modified Accrual Accounting

An accounting method that combines aspects of both accrual and cash accounting, recognizing revenues when they are earned and expenses when they are incurred or paid.

Long-Term Debt

Financial obligations of a company that are due more than one year in the future, often including bonds, mortgages, and leases.

Permanent Fund

A fund established by a government or organization meant to provide a permanent source of income.

Endowed Gift

A donation made to an institution with the stipulation that the principal is kept intact and only the investment income is used.