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The Fixed Costs of Service Departments Should Be Allocated to Production

Question 10

Multiple Choice

The fixed costs of service departments should be allocated to production departments based on


A) actual short-run utilization based on predetermined rates.
B) actual short-run units based on actual rates.
C) the service department's expected costs based on expected long-run use of capacity.
D) the service department's actual costs based on actual utilization of services.

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