1) Which of the following formulas should be used to allocate variable costs from service departments to user departments?
a. actual unit rate x total budgeted units planned to be used
b. budgeted unit rate x actual units used
c. budgeted unit rate x total budgeted units planned to be used
d. actual unit rate x actual units used
2) The phrase "cost allocation" refers to the allocation of total department costs to
a. service departments
b. service departments and producing departments
c. revenue - producing departments
d. revenue - producing products
3) If a department identifies more than one cost driver for overhead costs, the department ideally should
a. select a single cost driver
b. create as many cost pools as there are cost drivers
c. put 80 percent of the costs into one pool and 20 percent into the second pool
d. allocate 80 percent of the costs with 20 percent of the cost drivers