Which of the Following Statements Best Describes Cost Allocation

question 81

Multiple Choice

Which of the following statements best describes cost allocation?

• A)A company can maximize or minimize total company income by selecting different bases on which to allocate indirect costs.
• B)A company should select an allocation base to raise or lower reported income on given products.
• C)A company's total income will remain unchanged no matter how indirect costs are allocated.
• D)A company,as a general rule,should allocate indirect costs randomly or based on an "ability-to-bear" criterion.

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Definitions:

Upward Communication

This refers to the process in which information flows from the lower levels of a hierarchy to the upper levels in an organization.

Work Improvements

encompasses efforts and initiatives aimed at enhancing job performance, productivity, and satisfaction within the workplace.

Cross-cultural Communication

The process of exchanging information and understanding between individuals from different cultures, enabling effective interaction and collaboration.

Effective Principles

Fundamental norms or rules of conduct that, when followed, contribute to achieving desired outcomes efficiently and successfully.