The Reason for Tracing a Cost in Responsibility Accounting Is

question 129

Multiple Choice

The reason for tracing a cost in responsibility accounting is to determine which of the following?

• A) whether it is fixed or variable
• B) who has the best knowledge about why the costs arose
• C) what activity caused the costs to be incurred
• D) either who has the best knowledge about why the costs arose or, what activity caused the costs to be incurred
• E) whether it is production or administrative

---

Definitions:

Sales Personnel

Employees responsible for selling a company's products or services, often working on commission and interacting directly with clients.

Promotional Items

Products branded with a logo or slogan and distributed at little or no cost to promote a brand, corporate identity, or event.

Direct Expense

Costs that can be directly tied to the production of goods or services, such as raw materials and labor.

Salary Expense

The total amount paid to employees for their services during a specific period, excluding hourly wages.