Which of the Following Is TRUE Concerning Selecting a Cost-Allocation

question 154

Multiple Choice

Which of the following is TRUE concerning selecting a cost-allocation base in an ABC system?

• A)Cost-allocation bases are not relevant in defining the number of activity pools.
• B)All costs can be directly identified with a specific activity.
• C)The allocation base chosen may be constrained by the availability of reliable data.
• D)Costs may need to be allocated to services first, before the costs of services can be allocated to activities.
• E)Output unit-level costs cannot be related to a cost-allocation base.

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