Question
For companies in which full allocation is not followed, which of the following is true of corporate sustaining costs? A) allocated to divisions using cause-and-effect
For companies in which full allocation is not followed, which of the following is true of corporate sustaining costs?
A) allocated to divisions using cause-and-effect relationship | ||
B) allocated to customers using cause-and-effect relationship | ||
C) added to aggregate operating incomes of the divisions | ||
D) subtracted as a lump-sum amount after aggregating operating incomes of the divisions |
In 2016, Smart Office Systems Inc. (SOSI) used 25,840 pounds of plastic (direct materials) to produce 8000 units as opposed to 2017 when SOSI produced 8500 units using 27,840 pounds of plastic. The type of plastic SOSI uses cost $5 per pound in 2016 and rose to $5.25 per pound in 2017. In comparing results for these two years, what would be the cost effect of growth for the plastic material?
A) $8075 F | ||
B) $8479 U | ||
C) $8075 U | ||
D) $10,000 U |
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