One of the Best Arguments in Favor of the Full-Cost

Multiple Choice

One of the best arguments in favor of the full-cost approach to cost allocation is that:

A) It is easy to establish defensible bases of allocation.
B) It is less expensive and less time consuming than the contribution-margin approach.
C) The allocation bases are not as arbitrary as in the contribution margin approach.
D) Management in the territory (or whatever marketing unit is being analyzed) is made more aware of all costs - direct and indirect - than is true under the contribution-margin method.
E) In the long run all costs are variable.