Which of the following statements is false?
A) Both direct and indirect costs can be assigned to a cost object.
B) Cost drivers are often selected based on the availability of information.
C) Volume measures are good drivers for fixed overhead costs.
D) Fixed costs that do not have a definitive cost driver are allocated using an allocation base that distributes a rational share of the cost to each product.

Question

Quizplus · Accepted Answer

Volume measures are not good drivers for fixed overhead costs as fixed costs are not affected by changes in volume. Instead, activity-based drivers should be used for allocating fixed overhead costs.

Which of the Following Statements Is False