1. When allocating service department costs
A. a single basis (or activity base) should be used for all costs.
B.GAAP requires the use of industry-mandated standardized activity bases.
C. it is advisable to pro-rate costs based on departmental revenues.
D. various activity bases can be used for the costs allocated. none of the above are appropriate.
2. An activity-based cost allocation system:
A.Is one form of a direct or variable costing system.
B. Does not provide total unit cost data.
C. Traces costs to products on the basis of activities performed on them.
D. Does not provide for the allocation of any cost to products that cannot be directly attributable to those products.
E. Does not involve the level of detail and the number of allocations that companies make with traditional allocation methods.