With a fixed charge method, indirect IT department costs are ____.
A)treated as general organizational costs and not charged to other departments
B)allocated to other departments based on user-oriented activity
C)varied from month to month, depending on a department's use of resources
D)divided among all departments in the form of a set monthly charge

Question

Quizplus · Accepted Answer

With the fixed charge method, indirect IT department costs are divided among all departments in the form of a set monthly charge. This charge does not vary based on a department's use of resources, but is instead a predetermined, fixed amount. This approach is simpler and more straightforward than allocating costs based on user-oriented activity, and treats IT department costs as a shared expense for the entire organization.

With a Fixed Charge Method, Indirect IT Department Costs Are