[amp_mcq option1=”cost allocation” option2=”sales tracing” option3=”sales allocation” option4=”cost tracing” correct=”option1″]
The correct answer is A. cost allocation.
Cost allocation is the process of assigning indirect costs to cost objects. Indirect costs are costs that cannot be easily traced to a specific cost object. Examples of indirect costs include rent, utilities, and insurance.
Cost tracing is the process of assigning direct costs to cost objects. Direct costs are costs that can be easily traced to a specific cost object. Examples of direct costs include labor and materials.
Sales tracing is the process of assigning sales to cost objects. Sales tracing is used to determine the profitability of different products or services.
Sales allocation is the process of assigning sales to different departments or divisions within a company. Sales allocation is used to determine the profitability of different departments or divisions.
I hope this helps!