Which of the Following Purposes of Cost Allocation Provides Information

question 110

Multiple Choice

Which of the following purposes of cost allocation provides information for operational control in an organization?

• A) to compute income and asset valuations for financial reports
• B) to compute Cost of Goods Sold for financial reports
• C) to determine the number of cost drivers for a product
• D) to provide the desired motivation and to give feedback for performance evaluation

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Definitions:

Price Ceilings

Price controls that outlaw trade at prices above the ceiling.

Intended

Something that is planned or meant to happen in a specific way.

Price Floors

Price controls that outlaw trade at prices below the floor.

Intended

Designed or planned to serve a particular purpose.