When using the single-rate method, fixed cost allocation may be based on:
A)actual usage
B)budgeted usage
C)incremental cost allocation
D)Either A or B are correct.

Question

Quizplus · Accepted Answer

The single-rate method allows for fixed costs to be allocated based on either actual or budgeted usage. Thus, both choices A and B are correct. The choice between actual or budgeted usage will depend on the specific circumstances of the allocation and the availability of accurate usage data.

When Using the Single-Rate Method, Fixed Cost Allocation May Be