Match the appropriate shared cost categories with the appropriate (most common) allocation bases.
1) Utilities expense
2) Payroll processing costs
3) Cleaning costs
a. Number of employees in the department.
b. Square footage of floor space.
c. Number of employees in the department.
d. Sales in the department.
e. Not an allocated cost.
f. Number of items processed.
Allocation is the process of distributing the cost incurred to the goods or activity involved. Allocation can be done through the usage of plantwide allocation, departmental allocation, or activity-based allocation.
Answer and Explanation: 1
|1) Utilities expense||c. Number of employees in the department.||Utilities are used throughout the business and mostly...|
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fromChapter 4 / Lesson 2
Overhead costs are those that exist outside the labor and materials in production. Explore how these costs are driven by different factors, the importance of identifying them for efficiency and safety, as well as their variance between industries.