What Is the Reason for Pooling Costs

question 45

Multiple Choice

What is the reason for pooling costs?

• A)To shift costs from low-volume to high-volume products.
• B)It is a budgeting technique designed to accurately track fixed costs.
• C)Determining a pool rate for all costs incurred by the same activity reduces the number of cost assignments required.
• D)This procedure helps to determine which costs are directly related to production volume.
• E)It simplifies departmental overhead costing procedures.

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Definitions:

Debt Financing

The process of raising capital through borrowing money, which must be repaid with interest.

Crowd Sourcing

The practice of obtaining information, ideas, or content by soliciting contributions from a large group of people, typically from the online community, rather than from traditional employees or suppliers.