Assigning manufacturing overhead cost to activity pools is referred to as first-stage allocation because
A)costs are assigned first to the activity pools before being assigned to cost objects.
B)costs are assigned first to the activity pools before being assigned to cost drivers.
C)costs are assigned first to the activity pools before being assigned to activity drivers.
D)costs are assigned first to the activity pools before being assigned to activity objects.

Question

Quizplus · Accepted Answer

First-stage allocation refers to the process of assigning manufacturing overhead costs to activity pools before further allocating them to cost objects. This means that costs are assigned first to the activity pools before being assigned to cost objects. Therefore, choice A is the best answer.

Assigning Manufacturing Overhead Cost to Activity Pools Is Referred to as First-Stage