Criteria for selecting allocation bases for service department allocations should not include:
A) direct,traceable benefits from the service.
B) the extent of facilities provided.
C) the ease of making an allocation.
D) sales dollars generated during the perioD.
Revenues are never a good base for allocating service costs.

Question

Quizplus · Accepted Answer

Revenues are never a good base for allocating service costs. The other criteria listed (direct/traceable benefits, facilities provided, ease of allocation) can all be valid factors for selecting allocation bases.

Criteria for Selecting Allocation Bases for Service Department Allocations Should