Which of the Following Would Be the Best Allocation Base

question 53

Multiple Choice

Which of the following would be the best allocation base for a product designed for a specific customer?

• A)Quantity of materials used.
• B)Hours of design time.
• C)Square feet of space occupied.
• D)Number of new products.
• E)None of the answer choices is correct.

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Definitions:

Income Statement

A financial document that summarizes a company's revenues, expenses, and profits over a specific period, showing its operational performance.

Inventory

The total quantity of goods and materials that a business holds for the purpose of resale or production.

Source Of Supply

The origin from which goods, services, or materials are obtained, which can influence cost, quality, and delivery time.

Square-root Rule

A supply chain principle stating that the total safety stock investment is proportional to the square root of the number of locations.