Tuesday, November 15, 2011

To guide cost allocation decisions, the benefits-received criterion

ACCOUNTING

Multiple Choice

To guide cost allocation decisions, the benefits-received criterion

a. generally uses the cost driver as the cost allocation base.

b. results in subsidizing products that are not profitable.

c. is the primarily criterion used in activity-based costing.

d. may use an allocation base of division revenues to allocate advertising costs.

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