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‘chapter 6- Deparmental Costing and Cost locaton Flashcards | Quizlet
Chapter 6- Departmental Costing and Cost
Allocation
Terms in this set (10)
Effective cost drivers should
have which of the following
characteristics?
a. They should be perceived as
being fair.
b. They should create an
incentive for cost reduction.
c. They should create an
allocation rate based on
patient revenues.
d. Statements a. and b. are
both correct
e. Statements a. and c. are both
correct.
d. Statements a. and b. are both correct.
They should be perceived as being fair.
&
They should create an incentive for cost reduction.
The goal (purpose) of cost
allocation is to assign all
overhead costs to the activities
(primarily departments) that
cause the costs to be incurred.
a True
b. False
a. True
Chapter 6- Departmental Costing and Cost Allocation
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