Compared to Manufacturing Firms,cost Allocation in Service Firms

question 21

Multiple Choice

Compared to manufacturing firms,cost allocation in service firms:

• A) always requires greater sophistication in order to make work.
• B) usually places a greater emphasis on direct labour costs.
• C) emphasises direct material costs.
• D) only requires the consideration of overhead costs.

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Definitions:

Financial Statements

Records that provide an overview of a company's financial condition in both short and long term, including the balance sheet, income statement, and cash flow statement.

Common Shares

Equity securities that represent ownership in a corporation, giving shareholders voting rights and a share in the company's profits through dividends.

Contingency Reserves

Funds or resources set aside to cover unexpected costs or losses in a project, program, or portfolio, providing a financial cushion.

Accelerated Depreciation

A method of depreciation that allows for a higher expense deduction in the early years of an asset's life, decreasing its book value more quickly.