Under the traditional approach to cost allocation,the costs in each cost pool are allocated to a product in proportion to the product's usage of the ________.
A) available capacity
B) budgeted capacity
C) cost-allocation base
D) cost pool

Question

Quizplus · Accepted Answer

The cost allocation base is the driver or factor that causally affects the costs in a cost pool. Allocating costs to products based on their usage of the cost allocation base ensures that costs are allocated in a more accurate and relevant way. Choices A, B, and D do not align with the traditional approach to cost allocation.

Under the Traditional Approach to Cost Allocation,the Costs in Each