Which of the Following Is True Concerning Selecting a Cost-Allocation

Which of the following is true concerning selecting a cost-allocation base in an ABC system?

A) Cost-allocation bases are not relevant in defining the number of activity pools.
B) All costs can be directly identified with a specific activity.
C) The allocation base chosen may be constrained by the availability of reliable data.
D) Costs may need to be allocated to services first, before the costs of services can be allocated to activities.
E) Output unit-level costs cannot be related to a cost-allocation base.

Correct Answer:

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