Committed costs need to be treated in a special way so that the system
A) audits the amounts assigned.
B) periodically assigns a portion of their total cost to actual cost.
C) enters the amount of the cost one time at the end of the project.
D) enters the amount of the cost one time at the beginning of the project.

Question

Quizplus · Accepted Answer

Committed costs are costs that have already been contracted or committed to, such as salaries, rent, or equipment leases. These costs cannot be changed or avoided, and therefore they need to be allocated to the project in a special way. One common method is to periodically assign a portion of their total cost to actual cost, instead of entering the amount one time at the beginning or the end of the project. This allows for a more accurate reflection of the actual cost incurred by the project.

Committed Costs Need to Be Treated in a Special Way