Which of the following is a key consideration in selecting an allocation base?
A)The allocation base should have an indirect association with the cost objective.
B)The allocation base should be difficult to measure.
C)There should be logical association between the allocation base and the incidence of costs.
D)The allocation base should be out of the control of management.

Question

Quizplus · Accepted Answer

The allocation base should have a logical association between the allocation base and the incidence of costs. This means that the allocation base should have a direct cause-and-effect relationship with the cost being allocated. This ensures that the allocation is accurate and that costs are assigned to the appropriate cost center. The other options, such as being difficult to measure or out of management's control, are not necessarily desirable or relevant considerations in selecting an allocation base.

Which of the Following Is a Key Consideration in Selecting