If a company chooses to allocate central support costs,it is important to allocate them using ________.
A) actual or estimated usage
B) a fair approach accepted by managers
C) the indirect costs of each division
D) A and B

Question

Quizplus · Accepted Answer

It is important to allocate central support costs using both actual or estimated usage and a fair approach accepted by managers. This ensures that each division is charged fairly for the support they received and the costs are distributed appropriately. Allocating based on the indirect costs of each division alone may lead to unfair allocation and may not capture the actual usage of support services.

If a Company Chooses to Allocate Central Support Costs,it Is