If a company has three cost pools, it should have three different cost allocation bases.

Question

Quizplus · Accepted Answer

A cost pool is a grouping of costs that are similar in nature and that are allocated to cost objects using the same allocation base. If a company has three cost pools, it should have three different cost allocation bases because the costs in each cost pool are likely to be incurred for different reasons and should be allocated to cost objects based on different factors.

If a Company Has Three Cost Pools, It Should Have