The departmental approach of cost allocation recognizes that the typical manufacturing operation involves which type(s) of departments?
A)Service departments and production departments.
B)Production departments and assembly departments.
C)Joint product departments and separable departments.
D)Cost pools and cost objects.
E)Support departments and other service departments.

Question

Quizplus · Accepted Answer

The departmental approach of cost allocation is used to allocate costs to different departments in a manufacturing operation. These departments typically include both production departments, where the primary manufacturing activities take place, and service departments, which offer support functions such as maintenance or materials handling. Therefore, option A, which lists production and service departments, is the best choice. Options B, C, D, and E are not accurate because they do not reflect the typical structure of a manufacturing operation.

The Departmental Approach of Cost Allocation Recognizes That the Typical