Which Purpose of Cost Allocation Is Used to Encourage Sales

question 52

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 or compute reimbursement
• D) to measure income and assets for reporting to external parties

Apply overhead costs to products under both traditional and activity-based costing systems.

Understand the financial implications of using capacity as a basis for predetermined overhead rate calculation.

Understand the concept of predetermined overhead rate based on activity at capacity.

Calculate the amount of manufacturing overhead charged to a specific job when a predetermined overhead rate is used.

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Definitions:

Political Skill

The ability to effectively understand others at work and use such knowledge to influence others to act in ways that enhance personal and/or organizational objectives.

External Networks

Connections and relationships formed outside an organization's immediate environment, often used for strategic advantages.

Regulatory Agencies

Governmental bodies responsible for overseeing and enforcing laws and regulations within specific industries to protect public interest.

Across Cultures Competency

The ability to effectively interact, communicate, and work across different cultures and cultural backgrounds.