92 indicate whether each of the following statements is true or false 1 t indirect c 4301542
92. Indicate whether each of the following statements is true or false.
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1. T |
Indirect costs cannot be traced to a cost object in a cost-effective manner. |
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2. T |
For a factory with several departments, each department could be treated as a cost object. |
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3. T |
Depreciation on a factory building is a direct cost for the departments in the factory. |
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4. T |
For a factory with several departments, depreciation on equipment used in one department would be a direct cost to that department. |
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5. F |
An individual cost could be both fixed and direct with respect to a particular cost object. |
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93. Indicate whether each of the following statements is true or false.
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1. F |
Indirect costs are allocated to cost objects. |
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2. T |
Cost drivers are used to trace direct costs to cost objects. |
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3. F |
An allocation rate is calculated by dividing the allocation base by the total cost to be allocated. |
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4. T |
A cost driver must be identified for each cost pool that is to be allocated. |
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5. T |
Depreciation on a building might be allocated to the departments sharing the building based on the number of square feet occupied by each department. |
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