Consider the Following Statements About Support Department Cost Allocations

question 53

Multiple Choice

Consider the following statements about support department cost allocations.i.In a modern manufacturing environment,it is not necessary to allocate support department costs
Ii) Support department cost allocations continue to be necessary when a highly automated system is in use.
Iii) In a flexible manufacturing system,the need to allocate costs diminishes because more costs have become traceable to the product.Which statement/s is/are true?

• A) i
• B) i and ii
• C) ii and iii
• D) i,ii and iii

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Definitions:

Discounted Cash Flow Analysis

Discounted Cash Flow (DCF) Analysis is a method used to estimate the value of an investment based on its expected future cash flows, adjusted for the time value of money.

Strategic Options

Various choices available to a company to achieve its business objectives and increase shareholder value.

Financial Break-Even

The point at which total revenues exactly match total expenses, resulting in neither profit nor loss.

Sales Quantity

The cumulative quantity of a product or service purchased over a designated timeframe.