The Two Key Items in Determining the Budgeted Factory-Overhead Rate

question 33

Multiple Choice

The two key items in determining the budgeted factory-overhead rate are budgeted total overhead and _____.

• A)actual volume of the cost driver
• B)actual factory-overhead costs
• C)budgeted total volume of the cost driver
• D)estimated factory-overhead costs

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Definitions:

Net Income

The total earnings of a company after all expenses and taxes have been subtracted from total revenue.

Direct Materials

The essential components or raw inputs used directly in the manufacture of goods, critical to the production process.

Work in Process

Inventory representing partially completed goods, which include direct labor, material, and overhead costs incurred up to the point of measurement.

Finished Goods

Finished goods are merchandise or products that have completed the manufacturing process and are ready to be sold to customers.