Accounting 9706 · AS & A Level · Traditional costing methods

Traditional costing methods — practice question

A business allocates some of its overhead expenses among its production departments. Why could building maintenance costs be left out of the other overheads that are being allocated?

  • ABuilding maintenance costs are fixed.
  • BBuilding maintenance is not necessary for production to take place.
  • CNo suitable basis for apportionment can be found.
  • DThey can be identified with specific cost centres.

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