Which of the following statements regarding cost allocations isFalse?
A) Organizations might implement multiple cost pools when uses of service departments have both facility and unit level components
B) Using more cost pools should result in cost allocations that match resource use better than using fewer cost pools
C) All resources consumed in the organization should be allocated to service departments, regardless of whether service departments use the resources or not
D) Design and maintenance of a complex cost allocation system can be costly

Question

Quizplus · Accepted Answer

The statement that all resources consumed in the organization should be allocated to service departments, regardless of whether service departments use the resources or not, is false. Resources should be allocated based on actual use or benefit derived by the departments, not indiscriminately.

Which of the Following Statements Regarding Cost Allocations IsFalse