Budgeted Cost Rates Are Used for Allocating Variable Costs of Service

question 36

Multiple Choice

Budgeted cost rates are used for allocating variable costs of service departments to user departments because ________.

• A) it provides service departments a greater incentive to be efficient
• B) it protects user departments from inefficiencies in service departments
• C) it protects managers in service departments from inflation
• D) A and B

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Definitions:

Noam Chomsky

An influential linguist, philosopher, and cognitive scientist known for his theory of generative grammar and criticism of behaviorism.

Stimuli

External or internal factors that provoke a response or reaction from a biological organism or psychological system.

Hypothesis

A proposed explanation for a phenomenon, serving as a starting point for further investigation.

Accuracy

The degree to which a measurement, calculation, or specification conforms to the correct value or a standard.