It May Be Appropriate to Use a Departmental Costing System

question 16

True/False

It may be appropriate to use a departmental costing system when costs are incurred on different activities within a department but each activity has the same cost allocation base.

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Definitions:

Law Of Small Numbers

A bias in which people infer patterns or make generalizations from a small sample size, which may lead to misleading conclusions.

Gambler's Fallacy

The mistaken belief that if something happens more frequently than normal during some period, it will happen less frequently in the future, or vice versa.

Availability Heuristic

A cognitive shortcut that depends on the first examples that appear in someone's mind when considering a particular subject, idea, technique, or choice.

Conjunction Fallacy

The cognitive bias where people incorrectly believe specific conditions are more probable than a single general one.