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Costs are allocated to cost objects in many ways and for many reasons. Which one of the following is a purpose of cost allocation?

<p><em><strong>A. Evaluating revenue center performance.</strong></em></p> <p><em><strong>.B. Measuring income and assets for external</strong></em></p> <p><em><strong><span>reporting</span>C. Budgeting cash and controlling expenditures.</strong></em></p> <p><em><strong>D. Aiding in variable costing for internal reporting.</strong></em></p>

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Question added by Deleted user
Date Posted: 2014/10/07

A primary purpose of cost allocation is for proper matching expenses with revenues in accordance with the expense recognition principle so that we can appropriately measure income and assets for external reporting. Answer B is correct.

Deleted user
by Deleted user

Answer B is correct

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