Which of the following statements is true?

A) Support department cost allocations should be incorporated into a product costing system.
B) Support department cost allocations should be incorporated into the general accounting system but do not need to be incorporated into a product costing system.
C) Support department cost allocations can be ignored for more accurate product costing.
D) Support department cost allocations should be rolled into the general and administrative costs associated with the corporate office expenses.

Question

Celeste Ramirez · Accepted Answer

Final Answer : A, Explanation :  Support department cost allocations should be incorporated into a product costing system to ensure accurate product costs. This includes costs from departments that do not directly produce a product but provide essential support services, such as maintenance, which are necessary for production. Allocating these costs helps in accurately determining the total cost of producing a product.

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