Which of the Following Cost and Cost Allocation Base Have

question 55

Multiple Choice

Which of the following cost and cost allocation base have a strong cause and effect relationship?

• A) administration costs and cubic feet
• B) setup costs and square feet
• C) machine depreciation and output units
• D) machine maintenance and setup hours

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Definitions:

Federal Government Laws

Legislation enacted by the national government of a country that applies to all citizens and entities within its borders.

Gross Profit

a company's revenue minus its cost of goods sold, representing the profit a company makes after deducting the costs associated with making and selling its products.

Contribution Margin

The amount of money a product's sales generate over its variable costs, used to cover fixed costs and contribute to net profit.

Net Profit

The financial gain remaining after all expenses, taxes, and costs have been subtracted from total revenue.