Which of the Following Illustrates a Purpose for Allocating Costs

question 61

Multiple Choice

Which of the following illustrates a purpose for allocating costs to cost objects?

• A)to provide information for economic decisions
• B)to reduce competition
• C)to determine employee benefit costs
• D)to defer income and reduce taxes payable
• E)to evaluate managers and employees

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Definitions:

Property Use

The manner or purpose for which a property is used, subject to zoning laws and other regulations.

Escrow Account

A financial arrangement where a third party holds funds on behalf of transacting parties until specified conditions are met.

Neutral Third Party

An unbiased, independent individual or group engaged to help resolve disputes, negotiate agreements, or oversee transactions.

Deposit

A sum of money placed in an account or with a third party as a security for the performance of an obligation or the purchase of something.