When Choosing Between Budgeted Usage and Actual Usage as Allocation

Multiple Choice

When choosing between budgeted usage and actual usage as allocation bases, which of the following is true?

A) Actual rates let users know in advance what their costs are.
B) When budgeted rates are used, users must wait till the end of the budget period to know what their costs are.
C) With actual rates, a support department, rather than a user department, bears the risk of unfavourable cost variances.
D) Budgeted rates may lead to user departments outsourcing needed work, rather than relying on an internal support department.
E) Budgeted rates may help the manager of a support department to improve efficiency.