Which of the following is false regarding allocated common costs and a decision to eliminate a segment?

Multiple Choice

• Allocated common costs can be the reason it is financially advantageous to continue with a segment which shows a loss at the segment margin level.

• Allocated common costs will be avoided by eliminating the segment and therefore should be included in the financial advantage of eliminating the segment.

• Allocated common costs will continue even after the segment is eliminated.

• Saving money on allocated common costs should not be seen as a benefit of eliminating the segment.