The preferred cost allocation base for central corporate support costs is ________.
A)sales
B)cost of goods sold
C)total assets
D)usage

Question

Quizplus · Accepted Answer

The most accurate way to allocate central corporate support costs is by usage or the actual amount of services used by the business units. This ensures that each unit is charged only for the services that they utilized. Other bases such as sales, cost of goods sold, or total assets may not accurately reflect the amount of support services used by each unit.

The Preferred Cost Allocation Base for Central Corporate Support Costs