Since sales dollars represents "ability to pay," it is superior to most other bases used for allocating or charging service department costs.

Question

Quizplus · Accepted Answer

Sales dollars as a basis for allocating service department costs may not accurately reflect the actual use or benefit derived from the services provided, making it not necessarily superior to other allocation bases that might more closely match the cause-and-effect relationship between the service provided and the costs incurred.

Since Sales Dollars Represents "Ability to Pay," It Is Superior