Asked by calista Williams on May 09, 2024
Verified
Overhead can be applied to products using one of three different methods: single plantwide rate, multiple production department rates, and activity-based costing.
Single Plantwide Rate
A costing method where a single overhead rate is used to allocate all manufacturing overhead costs uniformly across all products, regardless of the department where costs are incurred.
Multiple Production Rates
Refers to the capability of a manufacturing process or facility to operate at various output rates to meet different levels of demand.
Activity-Based Costing
A costing method that identifies activities in an organization and assigns the cost of each activity to all products and services according to the actual consumption by each.
- Discern the different tactics for applying overhead, which encompass a single plantwide rate, multiple departmental rates, and activity-based costing (ABC).
Verified Answer
AB
ALLYSON BOWLESMay 14, 2024
Final Answer :
True
Explanation :
These three methods (single plantwide rate, multiple production department rates, and activity-based costing) represent common approaches for allocating overhead costs to products, each varying in complexity and accuracy.
Learning Objectives
- Discern the different tactics for applying overhead, which encompass a single plantwide rate, multiple departmental rates, and activity-based costing (ABC).