Allocation Base refers to a quantitative measure used to distribute costs among cost objects, such as products, departments, or projects. It serves as a foundation for assigning indirect costs in a systematic and rational manner, ensuring accurate cost allocation. Common allocation bases include labor hours, machine hours, or square footage. The selection of an appropriate allocation base is crucial for precise cost management and financial analysis.
CMA Prep Course
CMA Exam Academy is a proven, 16-week per part online coaching program to help you pass the CMA. The Academy’s comprehensive curriculum will help you pass the CMA exam and achieve your dreams of earning 6-figures per year, ascend to the executive ranks and earn the respect from your peers.
