If the Company Uses Activity-Based Costing (ABC),how Much Overhead Cost

question 65

Multiple Choice

If the company uses activity-based costing (ABC) ,how much overhead cost should be assigned to Job 101?

• A)$1,300
• B)$2,000
• C)$5,000
• D)$5,600

---

Definitions:

Financial Lease

A type of lease in which the lessee has use of the asset for a significant part of its useful life, offering benefits similar to ownership.

Lessor

An entity that rents out an asset or property to another party, known as the lessee.

Incremental Annual Cash Flow

Incremental Annual Cash Flow is the additional cash flow an enterprise generates from taking on a new project or investment, over its existing cash flow.

MACRS Depreciation

A method of depreciation used for tax purposes in the United States which allows businesses to recover their investments in certain property over a specified life.