To Guide Cost Allocation Decisions, the Benefits-Received Criterion

question 87

Multiple Choice

To guide cost allocation decisions, the benefits-received criterion:

• A)generally uses the cost driver as the cost allocation base
• B)results in subsidizing products that are not profitable
• C)is the primarily used criterion in activity-based costing
• D)may use an allocation base of division revenues to allocate advertising costs

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Definitions:

Thoughts

Mental processes in which ideas, opinions, and beliefs are formulated, often as part of reasoning and cognition.

Non-normative

Events or experiences that do not follow the typical or expected life trajectory.

Age-graded

Refers to activities, expectations, or roles that are assigned based on an individual's age in a society.

Cross-cultural

Pertains to or involving the comparison of different cultures or the interaction between them.