should be used to allocate fixed costs.
A) Budgeted fraction of capacity available for use x actual fixed costs
B) Actual fraction of capacity used x actual fixed costs
C) Actual fraction of capacity used x total budgeted fixed costs
D) Budgeted fraction of capacity available for use x total budgeted fixed costs

Question

Quizplus · Accepted Answer

The budgeted fraction of capacity available for use multiplied by total budgeted fixed costs is used to allocate fixed costs, as it aligns with planned capacity and cost expectations rather than actual usage, which can vary.

Should Be Used to Allocate Fixed Costs