The Key to Allocating Overhead Costs in Service Organisations Is

question 7

Multiple Choice

The key to allocating overhead costs in service organisations is the determination of the ______.

• A) overhead
• B) cost driver
• C) direct labour
• D) total service cost

---

Definitions:

Cash Discount

A reduction in the invoice price offered to buyers as an incentive for early payment.

Wholesalers

Companies that sell merchandise to other businesses rather than to the public.

Credit Terms

Terms for payment on account by the buyer to the seller.

Sales Discount

A reduction in the price of goods or services offered to customers, often to prompt early payment or bulk purchases.