Cobalt Company management has identified the following cost objects: Cost Object 1: The cost of operating the finishing department
Cost Object 2: The cost of operating the factory
Cost Object 3: The cost of a particular product made in June
With respect to these cost objectives, how would rent paid by the finishing department for storage space be classified?

A) Option A
B) Option B
C) Option C
D) Option D

Question

Cobalt Company management has identified the following cost objects: Cost Object 1: The cost of operating the finishing department
Cost Object 2: The cost of operating the factory
Cost Object 3: The cost of a particular product made in June
With respect to these cost objectives, how would rent paid by the finishing department for storage space be classified?

A) Option A 
B) Option B 
C) Option C 
D) Option D

Quizplus · Accepted Answer

The rent paid by the finishing department for storage space is traceable to the cost of operating the finishing department and the cost of operating the factory, but is not easily traced to the cost of a particular product made in June.

Cobalt Company Management Has Identified the Following Cost Objects: Cost