The correct answer is: A. Cost Apportionment
Cost apportionment is the process of allocating indirect costs to cost centers or cost units. Indirect costs are costs that cannot be easily traced to a specific cost center or cost unit. They are often allocated based on a predetermined allocation base, such as machine hours or labor hours.
Cost allocation is the process of assigning costs to products or services. It is similar to cost apportionment, but it is more focused on assigning costs to specific products or services. Cost allocation is often used in a costing system to determine the cost of a product or service.
Cost absorption is the process of assigning all costs, both direct and indirect, to products or services. It is similar to cost allocation, but it is more comprehensive. Cost absorption is often used in a costing system to determine the full cost of a product or service.
Machine hour rate is a method of costing that uses the number of machine hours to assign costs to products or services. It is a common method of costing in manufacturing industries.
In conclusion, cost apportionment is the process of allocating indirect costs to cost centers or cost units. It is a common method of costing in many industries.