More cost pools:
A)always result in better estimates of overhead costs.
B)seldom result in better estimates of overhead costs.
C)are usually beneficial if the pattern of demand varies across resources.
D)result in lower estimates of total overhead costs.

Question

Quizplus · Accepted Answer

Cost pools are used to allocate overhead costs to specific products or services. When the pattern of demand varies across resources, more cost pools will result in better accuracy in estimating overhead costs, since the resources can be allocated more accurately. However, simply adding more cost pools does not always result in better estimates, and in some cases may result in lower estimates or unnecessary complexity.

More Cost Pools