An accounting system that accumulates and reports costs incurred by each service department for management to evaluate the performance of a department is a:
A) Standard accounting system.
B) Cost accounting system.
C) Departmental accounting system.
D) Service accounting system.
E) Revenue accounting system.

Question

Quizplus · Accepted Answer

A departmental accounting system is specifically designed to accumulate and report costs incurred by each service department. This type of accounting system allows management to evaluate the performance of each department based on the costs incurred and enables the organization to allocate costs more accurately. Standard accounting systems are used to record financial transactions, while cost accounting systems focus on identifying and allocating costs to products and services. Service and revenue accounting systems are not relevant to this scenario.

An Accounting System That Accumulates and Reports Costs Incurred by Each