When the cost pools are homogeneous ________.
A) the number of needed cost pools will be more
B) the costs in the cost pool have a similar cause-and-effect or benefits-received relationship with the cost-allocation base
C) managers should not allocate both variable costs and costs that are fixed in the short-run
D) there will be a greater variety of cause-and-effect, benefits-received, or fair-and-equitable relationship with the cost-allocation base

Question

Quizplus · Accepted Answer

When cost pools are homogeneous, it means that the costs within the pool have a similar cause-and-effect or benefits-received relationship with the cost-allocation base. Therefore, the best choice is B.

When the Cost Pools Are Homogeneous ________