Which of the following is a reason to accumulate and separately assign costs by departments?
A)The company wants to reduce the complexity of its cost accounting system.
B)The company is comprised of multiple departments, each of which exhibit unique cost behaviour patterns.
C)The company wishes to implement an activity based costing system.
D)The company has a large amount of capital invested in human resource training.

Question

Quizplus · Accepted Answer

The reason to accumulate and separately assign costs by departments is because the company is comprised of multiple departments, each of which exhibit unique cost behaviour patterns. By doing this, the company can better understand and manage its costs on a departmental level, which can lead to improved decision making and cost control. Options A, C, and D do not specifically relate to the need to separately assign costs by departments.

Which of the Following Is a Reason to Accumulate and Separately