Oracle Financial Reporting and Analysis Cloud 2017 Implementation Essentials — Question 34

Your company creates a separate project for infrastructure services, so as to track these costs separately and then allocate to various projects that use the services of the infrastructure team. You want to allocate these costs by first attributing a fixed percentage of the source amount to each project and then spread it across tasks based on the actual labor hours charged to each task.
Which allocation basis method would you use to meet this requirement? (Choose the best answer.)

Answer options

• A. spread evenly
• B. target percentage and prorate
• C. target percentage and spread evenly
• D. prorate

Correct answer: A

Explanation

The correct answer is A, 'spread evenly', as it allows for the initial allocation of a fixed percentage of costs to each project, which aligns with the requirement of attributing a set amount before distributing it across tasks. The other options introduce complexity such as prorating or varying spreads, which do not adhere to the specified method of using a fixed percentage followed by an even distribution.