Cost allocation involves:
A) identifying a cost driver for each cost to be allocated.
B) calculating an allocation rate for each cost to be allocated.
C) multiplying the allocation rate by the weight of the cost driver.
D) All of these answers are correct.

Question

Quizplus · Accepted Answer

Cost allocation involves all of the above steps. First, identifying a cost driver for each cost to be allocated, then calculating an allocation rate for each cost to be allocated, and finally multiplying the allocation rate by the weight of the cost driver. Therefore, option D is the correct answer.

Cost Allocation Involves