Question

accounting multiple choice

Which of the following best describes the advantages of using a predetermined overhead rate? Select one or more: a. Both (a) and (C) above. b. Overhead costs are applied evenly throughout the year rather than fluctuating from month to month. c. Predetermined rates require managers to wait until long after the accounting period to get an estimate of product costs. d. Total unit costs of production are known sooner than using actual overhead rates, and overhead costs are evenly distributed throughout the year. A cost driver is an activity or transaction that causes costs to be incurred. Select one: O True O False A job cost system is used: Select one or more: a. By manufacturers and service companies. b. When there are dissimilar products. c. When goods are produced to meet a customer's particular needs. d. All of the above. Control charts are a means of distinguishing between random or routine variation in product quality and variations that managers should investigate. Select one: O True O False

Answer 1

Which of the following best describes the advantages of using a predetermined overhead rate. Answer: b. Overhead costs are applied evenly throughout the year rather than fluctuating from month to month d. Total unit costs of production are known sooner than using actual overhead rates, and overhead costs are evenly distributed throghout the year. Activity or transaction that causes costs to be incurred. Answer: True For example Machine-hours can be a cost driver for costs of energy to run machines. A job cost system is used: Answer: d. All of the above. Control charts are a means distinguishing between random or routine variation in product quality and variations that managers should investigate. Answer: True