Which of the following would probably be the most accurate cost driver to use for allocating the costs associated with a company's engineering department?
A) Number of customers
B) Number of designs developed
C) Machine hours
D) Direct labor dollars

Question

Quizplus · Accepted Answer

The most accurate cost driver for allocating costs associated with the engineering department would be the number of designs developed since engineering is directly related to developing designs. The other options (number of customers, machine hours, and direct labor dollars) do not necessarily have a direct relationship with engineering department costs.

Which of the Following Would Probably Be the Most Accurate