Office expenses such as postage and stationery should be allocated on the basis of contribution margin of each department.

Question

Quizplus · Accepted Answer

Office expenses such as postage and stationery are usually considered indirect expenses and are typically allocated based on an appropriate allocation method, such as headcount or square footage. They are not typically allocated based on contribution margin, which is a measure of how much revenue is left after deducting variable costs from sales.

Office Expenses Such as Postage and Stationery Should Be Allocated