Which of the following statements about choosing the best cost driver base is not true?
A) The base should logically have a cause and effect relationship with the activity and the use of resources
B) The cost driver should be based on the theoretical capacity of the resource to support activities
C) The base should be feasible to measure
D) The base should predict or explain activities' use of resources with reasonable accuracy

Question

Quizplus · Accepted Answer

The cost driver should not necessarily be based on the theoretical capacity of the resource, but rather on the actual or practical activity that causes the incurrence of cost, making statement B incorrect.

Which of the Following Statements About Choosing the Best Cost