Which of the Following Would Be the Least Appropriate Allocation

question 44

Multiple Choice

Which of the following would be the least appropriate allocation base for allocating overhead in a highly automated (i.e., capital-intensive) manufacturing company?

• A) Electricity used.
• B) Machine hours.
• C) Direct labor hours.
• D) Material consumed.

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Definitions:

Supply

The total amount of a product or service available for purchase at any given price level in a given market.

Fiscal Policy

Government policies regarding taxation and spending that aim to influence economic conditions, such as growth rates, inflation, and unemployment.

GDP

Gross Domestic Product, a monetary measure of the market value of all the final goods and services produced in a specific time period within a country's borders.

New Deal

A series of programs, public work projects, financial reforms, and regulations enacted by President Franklin D. Roosevelt in the United States during the 1930s in response to the Great Depression.