Question

What is the reason for pooling costs? Group of answer choices Determining a pool rate for all costs incurred by the same activity reduces the number of cost assignments required. This procedure helps to determine which costs are directly related to production volume. It is a budgeting technique designed to accurately track fixed costs. To shift costs from low-volume to high-volume products.

Answer 1

Answer:

The correct answer is letter "A": Determining a pool rate for all costs incurred by the same activity reduces the number of cost assignments required.

Explanation:

Cost pooling refers to adding similar costs to allocate them among the activities from where those costs can be derived. The total amount of the cost is divided between the activities which generate a more efficient allocation method. It is more commonly referred to as Activity Cost Polling in Accounting. This calculation avoids having more cost assignments.