All of the Following Are Methods Used to Allocate Indirect

question 54

Multiple Choice

All of the following are methods used to allocate indirect costs in a marketing cost analysis,EXCEPT:

• A)divide cost equally across all territories.
• B)allocate cost in proportion to sales volume obtained from each territory.
• C)allocate 100% of the cost to the largest territory.
• D)allocate cost in same proportion as total direct costs of each territory.
• E)All of these are methods commonly used.

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Definitions:

Credit Card Company

A Credit Card Company is a financial institution that issues credit cards to consumers, extending a line of credit for purchases with the agreement that the consumer will pay back the borrowed amount, plus any applicable interest.

Allowance for Doubtful Accounts

Allowance for doubtful accounts is an accounting provision that estimates the amount of receivables that may not be collectible due to customer defaults.

Credit Sales

Sales made on credit, allowing the buyer to pay the seller at a later date.

Sales Discounts

Reductions in the selling price offered to customers, often as an incentive for early payment or bulk purchases.