In a costing system

Question

In a costing system

Quizplus · Accepted Answer

A cost allocation base can be either financial (such as labor hours) or nonfinancial (such as machine setups). The other statements in the options are incorrect. Cost tracing allocates direct costs, not indirect costs (option A); cost allocation assigns indirect costs, not direct costs (option B); there can be multiple indirect cost pools depending on the company's needs (option C); cost objects can be products, services, departments, or even customers (option D).

In a Costing System