State the difference between cost allocation and cost assignment.

Question

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Answer 1

Question

Chapter 3, Problem 1Q

To determine

State the difference between cost allocation and cost assignment.

Expert Solution & Answer

Explanation of Solution

Difference between cost allocation and cost assignment is as follows:

Cost assignment is the process of allocating costs to cost pools and cost objects either by direct tracing or allocation. Direct tracing is used for allocating direct costs, and allocation is used for indirect costs. While on the other hand, allocating of indirect costs to cost pools and cost objects is known as cost allocation wherein, direct tracing is not feasible economically.

To be precise, if there is a direct and traceable link among the cost and the cost pool or cost object then the management accountant can use cost allocation and if there is an indirect link among the cost and “the cost pool or cost object” then the management accountant can use cost assignment.

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Answer 2

Question

Chapter 3, Problem 1Q

To determine

State the difference between cost allocation and cost assignment.

Expert Solution & Answer

Explanation of Solution

Difference between cost allocation and cost assignment is as follows:

Cost assignment is the process of allocating costs to cost pools and cost objects either by direct tracing or allocation. Direct tracing is used for allocating direct costs, and allocation is used for indirect costs. While on the other hand, allocating of indirect costs to cost pools and cost objects is known as cost allocation wherein, direct tracing is not feasible economically.

To be precise, if there is a direct and traceable link among the cost and the cost pool or cost object then the management accountant can use cost allocation and if there is an indirect link among the cost and “the cost pool or cost object” then the management accountant can use cost assignment.

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Answer 3

Question

Chapter 3, Problem 1Q

To determine

State the difference between cost allocation and cost assignment.

Expert Solution & Answer

Explanation of Solution

Difference between cost allocation and cost assignment is as follows:

Cost assignment is the process of allocating costs to cost pools and cost objects either by direct tracing or allocation. Direct tracing is used for allocating direct costs, and allocation is used for indirect costs. While on the other hand, allocating of indirect costs to cost pools and cost objects is known as cost allocation wherein, direct tracing is not feasible economically.

To be precise, if there is a direct and traceable link among the cost and the cost pool or cost object then the management accountant can use cost allocation and if there is an indirect link among the cost and “the cost pool or cost object” then the management accountant can use cost assignment.

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Answer 4

Question

Chapter 3, Problem 1Q

To determine

State the difference between cost allocation and cost assignment.

Expert Solution & Answer

Explanation of Solution

Difference between cost allocation and cost assignment is as follows:

Cost assignment is the process of allocating costs to cost pools and cost objects either by direct tracing or allocation. Direct tracing is used for allocating direct costs, and allocation is used for indirect costs. While on the other hand, allocating of indirect costs to cost pools and cost objects is known as cost allocation wherein, direct tracing is not feasible economically.

To be precise, if there is a direct and traceable link among the cost and the cost pool or cost object then the management accountant can use cost allocation and if there is an indirect link among the cost and “the cost pool or cost object” then the management accountant can use cost assignment.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 3, Problem 1Q

To determine

State the difference between cost allocation and cost assignment.

Expert Solution & Answer

Explanation of Solution

Difference between cost allocation and cost assignment is as follows:

Cost assignment is the process of allocating costs to cost pools and cost objects either by direct tracing or allocation. Direct tracing is used for allocating direct costs, and allocation is used for indirect costs. While on the other hand, allocating of indirect costs to cost pools and cost objects is known as cost allocation wherein, direct tracing is not feasible economically.

To be precise, if there is a direct and traceable link among the cost and the cost pool or cost object then the management accountant can use cost allocation and if there is an indirect link among the cost and “the cost pool or cost object” then the management accountant can use cost assignment.

Answer 6

Chapter 3, Problem 1Q

To determine

State the difference between cost allocation and cost assignment.

Expert Solution & Answer

Explanation of Solution

Difference between cost allocation and cost assignment is as follows:

Cost assignment is the process of allocating costs to cost pools and cost objects either by direct tracing or allocation. Direct tracing is used for allocating direct costs, and allocation is used for indirect costs. While on the other hand, allocating of indirect costs to cost pools and cost objects is known as cost allocation wherein, direct tracing is not feasible economically.

To be precise, if there is a direct and traceable link among the cost and the cost pool or cost object then the management accountant can use cost allocation and if there is an indirect link among the cost and “the cost pool or cost object” then the management accountant can use cost assignment.

Answer 7

Chapter 3, Problem 1Q

To determine

State the difference between cost allocation and cost assignment.

Answer 8

Expert Solution & Answer

Explanation of Solution

Difference between cost allocation and cost assignment is as follows:

Cost assignment is the process of allocating costs to cost pools and cost objects either by direct tracing or allocation. Direct tracing is used for allocating direct costs, and allocation is used for indirect costs. While on the other hand, allocating of indirect costs to cost pools and cost objects is known as cost allocation wherein, direct tracing is not feasible economically.

To be precise, if there is a direct and traceable link among the cost and the cost pool or cost object then the management accountant can use cost allocation and if there is an indirect link among the cost and “the cost pool or cost object” then the management accountant can use cost assignment.