Which of the Following Costs Would Normally Not Be Included

question 69

Multiple Choice

Which of the following costs would normally not be included in the cost of equipment?

• A) Insurance for equipment after it has started being used.
• B) Installation of equipment.
• C) Freight paid by buyer to have equipment shipped.
• D) Testing of equipment.

Understand the financial implications of basing overhead rates on estimated vs. capacity activity levels.

Calculate the estimated total manufacturing overhead for the year.

Calculate the predetermined overhead rate for the year.

Calculate the amount of overhead applied to specific jobs.

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Definitions:

Positive Association

A relationship between two variables in which they increase or decrease together.

Little or No Association

A statistical term indicating a weak or nonexistent relationship between two variables.

Explanatory

pertaining to or serving to explain, often used to describe variables that aim to explain observed phenomena.

Response

The outcome or measurement of interest in a study or experiment that is influenced by the independent variable.