Scarborough Sales, a real estate company specializing in apartment rentals and home sales, is having difficulty in gathering appropriate cost information for evaluating its operations.It owns several large apartment complexes and sells homes owned by builders or existing homeowners.As the company's new accountant you define cost by major activity.You use this information for allocating costs to cost objects.Also, cost pools are created for appropriate cost allocations.The owner of the company is interested in exactly what you have done, and why it appears to be working so smoothly.Required:
Briefly state the four purposes for allocating costs to cost objects and give two examples of how each can be used for the real estate company.
