The Multiplier Is Greater Than 1 Because

question 241

Multiple Choice

The multiplier is greater than 1 because

• A) most households are unable to save.
• B) corporate spending exceeds corporate income.
• C) one personʹs spending becomes anotherʹs income.
• D) household spending exceeds income.

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Definitions:

Departmental Predetermined Overhead Rates

The estimated overhead rates assigned to different departments within a company, used for more accurate product costing.

Markup

The amount added to the cost price of goods to cover overhead and profit; a percentage of the cost.

Machine-Hours

A measure of production volume or activity based on the number of hours machines are operated.

Machine-Hours

A measurement used in cost accounting to allocate expenses to products or job orders, based on the number of hours machines are operated.