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For each item listed, select the appropriate purpose of cost allocation from the list below. A purpose may be used more than once. A -
For each item listed, select the appropriate purpose of cost allocation from the list below. A purpose may be used more than once.
A - To provide information for economic decisions
B - To motivate managers and other employees
C - To measure income and assets for reports to external parties
D - To justify costs or compute reimbursement amounts
Required
- To encourage simpler product design
- To cost inventories for reporting on a company's tax return
- To encourage the sales department to focus on high-margin products
- To evaluate a make or buy decision
- To cost inventories for the balance sheet
- To decide whether to add or delete a product line
- To decide on an appropriate selling price for a special-order product
- To cost a product at a fair price for government contracts
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