To guide cost allocation decisions, the cause-and-effect criterion may allocate corporate salaries to divisions based on profits.

1. To guide cost allocation decisions, the cause-and-effect criterionmay allocate corporate salaries to divisions based on profits.is used less frequently than the other criteria.is the primary criterion used in activity-based costing.is a difficult criterion on which to obtain agreement.2. Which cost-allocation criterion is MOST likely to subsidize poor performers at the expense of the best performers? Cause-and-effect criterionAbility-to-bear criterionFairness-or-equity criterionBenefits-received criterion3.The MOST likely reason for allocating all corporate costs to divisions include thatdivisions receive benefits from all corporate costs.division managers make decisions that ultimately control corporate costs.the hierarchy of costs promotes cost management.it is best to use multiple cost objects.Answer1. to guide cost allocation decisions, the cause-and-effect criterionAnswer C) is the primary criterion used in activity-based costing. 2) Which cost-allocation criterion is MOST likely to…

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