Allocating common costs is clear-cut and can best be achieved by using the stand-alone cost-allocation method.

Question

Quizplus · Accepted Answer

Allocating common costs can be complex and there are various cost-allocation methods that can be used depending on the circumstances, such as the relative benefits received by different departments or products. The stand-alone cost-allocation method, which simply allocates common costs in proportion to each department's or product's individual cost, may not be the most appropriate method in all cases.

Allocating Common Costs Is Clear-Cut and Can Best Be Achieved