Which Purpose of Cost Allocation Is Used to Encourage Sales

question 12

Multiple Choice

Which purpose of cost allocation is used to encourage sales representatives to push high-margin products or services?

• A)to provide information for economic decisions
• B)to motivate managers and other employees
• C)to justify costs
• D)to measure income and assets for reporting to external parties
• E)to compute reimbursement

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Definitions:

Agent

represents a person authorized to act on behalf of another, known as the principal, in dealings with third parties, typically in commercial transactions or contractual agreements.

Buyer And Seller

Represents the two primary parties involved in a transaction, where the buyer acquires goods, services, or assets from the seller in exchange for money or other compensation.

Real Property

Land and everything permanently attached to it.

Owner's Interest

The rights and stake a person has in an asset or property, often relating to ownership and equity.