Question
a- The Difference bwteeen practical capacity and master- budget capacity utilization is the best measure of management's ability to balance the costs of having
a- " The Difference bwteeen practical capacity and master- budget capacity utilization is the best measure of management's ability to balance the costs of having too much capacity and having too little capacity." Do you agree? Explain
b- "To ensure unbiased cost allocations, fixed costs should br allocated on the basis of estimated long-run use by user-department managers." Do you agree?Why?
c- Describe how companies are increasingly facing revenue-allocation decisions. Distinguish between the stand-alone and the incremental revenue-allocation methods. Identify and discuss arguments that individual product managers may put forward to support their preferred revenue-allocation method.
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