Peanut-butter costing ________.
A)is not used to spread the cost of resources to cost objects
B)spreads the cost of resources uniformly to cost objects
C)spreads the revenues of resources to a single cost object
D)failed to spread the cost of resources uniformly to cost objects
E)does not average the cost of resources uniformly to cost objects

Question

Quizplus · Accepted Answer

Peanut-butter costing is a type of costing method that spreads the cost of resources uniformly to cost objects, just like how peanut butter spreads uniformly on a slice of bread. It is based on the principle that all cost objects consume resources in a similar proportion. This method is also known as the single rate or single predetermined overhead rate method. Therefore, option B is the correct answer. The other options are incorrect as they do not accurately describe peanut-butter costing.

Peanut-Butter Costing ________