If the allocation is for product costing,how would the allocation of variable support department costs be calculated?

Question

Quizplus · Accepted Answer

The most appropriate method for allocating variable support department costs for product costing is the Budgeted rate multiplied by Budgeted usage. This method ensures that costs allocated to products are based on the predetermined budgeted rate and the planned usage of the support department resources. Actual usage and actual rates are not suitable because they do not reflect the planned costs and usage, which could result in distorted product costs. Budgeted rate multiplied by Actual usage seems reasonable, but it could result in over or under-allocating costs to products depending on the variability of the actual usage. Therefore, the best choice is D, Budgeted rate multiplied by Budgeted usage.

If the Allocation Is for Product Costing,how Would the Allocation