Finley Company has its company headquarters based in Raleigh,North Carolina,and has six individual retail stores spread throughout North Carolina and Virginia.Which of the following costs would most likely be treated as a common cost for segmented reporting purposes?
A) Lease costs for the company headquarters
B) Property tax costs for the Virginia stores
C) Direct labour costs for the North Carolina stores
D) Utilities costs for the both the Virginia and North Carolina stores

Question

Quizplus · Accepted Answer

Lease costs for the company headquarters are a common cost because they are incurred to support the overall operations of the company, including all of its retail stores, regardless of location. Property tax costs for the Virginia stores, direct labour costs for the North Carolina stores, and utilities costs for both the Virginia and North Carolina stores are specific to individual locations and would be treated as separate costs for segmented reporting purposes.

Finley Company Has Its Company Headquarters Based in Raleigh,North Carolina,and