When allocating indirect production costs to cost objects,which of the following is/are a cost-allocation base(s)?
A) some measure of input or output that determines the amount of cost to be allocated to a cost object
B) a measure used to assign indirect costs to cost objects
C) a measure used to assign direct costs to cost objects
D) A and B

Question

Quizplus · Accepted Answer

Both A and B are correct statements as cost-allocation bases are used to determine the amount of indirect cost to be allocated to a cost object. Direct costs, on the other hand, are already assigned to the cost object and do not require a cost-allocation base. Therefore, only statement C is incorrect.

When Allocating Indirect Production Costs to Cost Objects,which of the Following