Which of the following is the least likely alternative to be used to allocate costs?
A) Use a different cost driver for each cost pool.
B) Allocate all costs evenly to all other departments.
C) Allocate some cost pools using cost drivers and leave other cost pools unallocated.
D) Use one cost driver to allocate all department costs.

Question

Quizplus · Accepted Answer

Allocating all costs evenly to all other departments is not a rational approach as it does not reflect the actual usage of resources by each department, and it does not promote cost efficiency. Therefore, it is the least likely alternative to be used to allocate costs. Options A, C, and D are all valid alternatives to allocate costs depending on the circumstances.

Which of the Following Is the Least Likely Alternative to Be