Traditional Overhead Allocations Result in Which of the Following Situations

question 85

Multiple Choice

Traditional overhead allocations result in which of the following situations?

• A)Overhead costs are assigned as period costs to manufacturing operations.
• B)High-volume products are assigned too much overhead,and low-volume products are assigned too little overhead.
• C)Low-volume products are assigned too much,and high-volume products are assigned too little overhead.
• D)The resulting allocations cannot be used for financial reports.

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Definitions:

BCG Matrix

A strategic business tool developed by the Boston Consulting Group that uses market growth rate and market share to evaluate the relative performance of products or business units.

Market Leaders

Market leaders are companies that hold the largest market share in a particular industry or category, often setting trends, pricing standards, and competitive benchmarks.

Low-Growth Markets

Markets characterized by small or stagnant growth rates, making them challenging environments for businesses to achieve high returns.

Market Growth Rate

The increase in size or sales of a market over a specific period.