Preston Company Has Three Divisions

question 145

Multiple Choice

Preston Company has three divisions.The company should consider a cost to be a direct cost of a division if:

• A) It meets guidelines imposed by generally accepted accounting principles.
• B) It can be traced to a division in a cost-effective manner.
• C) It is a variable cost.
• D) It can be allocated to a division.

---

Definitions:

Exact Value

The precise numerical amount or measurement of an item, without approximation or rounding.

Bidders

individuals or entities that offer a price for goods, services, or assets in auctions or competitive bidding scenarios.

Common-value Auction

A type of auction where the item being sold holds the same worth to every participant, however, the participants might possess varying levels of knowledge regarding the true value of the item.

Releasing Information

The act of making certain data or facts available to the public or specific groups.