(CPA)Which of the following statements is true about support cost allocation?
A)Companies can maximize or minimize their income by selecting different allocation bases for support costs
B)Companies can select allocation bases to raise or lower reported income on given products
C)Companies' total incomes will remain unchanged no matter how support costs are allocated
D)Companies should usually allocate support costs randomly or based on an ability-to-bear criterion

Question

Quizplus · Accepted Answer

The total income of a company remains unchanged regardless of how support costs are allocated, as allocation only affects the distribution of costs among products or departments, not the overall cost or income.

(CPA)Which of the Following Statements Is True About Support Cost