In general,variable costs are allocated using a first-stage cost allocation system and fixed costs are allocated using a second-stage cost allocation system.Variable and fixed costs are both involved in the first-stage cost allocation.

Question

Quizplus · Accepted Answer

Variable and fixed costs are typically allocated in the second-stage cost allocation system, not the first-stage. The first-stage allocation usually involves assigning costs to cost pools, not distinguishing between variable and fixed costs.

In General,variable Costs Are Allocated Using a First-Stage Cost Allocation