You are a Dynamics 365 Finance consultant.
You plan to configure the allocation base, cost behavior, and cost distribution.
Which three actions do these configurations accomplish? Each correct answer presents a complete solution.
NOTE: Each correct selection is worth one point.
Click on the arrows to vote for the correct answer
A. B. C. D. E.ABE.
https://docs.microsoft.com/en-us/dynamics365/finance/cost-accounting/terms-cost-accountingSure, I can provide a detailed explanation of the answer options for this question:
A. Spread costs from one cost object to one or more other cost objects by applying a relevant allocation base. Configuring the allocation base allows you to distribute or allocate costs from one cost object (such as a department, product line, or project) to one or more other cost objects. An allocation base is a measure that you use to determine how much of the cost should be allocated to each object. For example, if you have a manufacturing plant with two production lines, you might allocate the costs of electricity to each line based on the number of machine hours used on each line as the allocation base. Configuring the allocation base allows you to accurately distribute costs and better understand the cost structure of your business.
B. Measure and quantify activities, such as machine hours that are used, kilowatt hours that are consumed, or square footage that is occupied. Configuring the cost behavior allows you to measure and quantify activities that consume resources in your business. Cost behavior refers to how costs respond to changes in key business activities, such as production volume, machine usage, or labor hours. By measuring and quantifying these activities, you can better understand the drivers of your costs and make informed decisions to reduce or optimize them.
C. Spread the balance of the cost from one cost object to one or more other cost objects by applying a relevant allocation base. This answer option is similar to option A. Configuring the allocation base allows you to spread the balance of the cost from one cost object to one or more other cost objects, based on a relevant allocation base. This helps you understand how much of the cost is associated with each object and make informed decisions about how to allocate resources.
D. Control which journals can be used in the costing process. This answer option is not directly related to configuring the allocation base, cost behavior, or cost distribution. However, controlling which journals can be used in the costing process can be an important aspect of managing costs in Dynamics 365 Finance. By controlling access to journals, you can ensure that only authorized users are able to make changes to cost data.
E. Classify costs according to their behavior in relation to changes in key business activities. This answer option is related to configuring the cost behavior, as discussed in option B. By classifying costs according to their behavior in relation to changes in key business activities, you can better understand how costs will respond to changes in your business operations. For example, some costs may be fixed (i.e. do not vary with changes in production volume), while others may be variable (i.e. increase or decrease with changes in production volume). By classifying costs in this way, you can make informed decisions about how to optimize your cost structure.