It Is Estimated That During the Coming Year, Factory Overhead

question 61

Multiple Choice

It is estimated that during the coming year, factory overhead costs will be $675,000 and direct labor costs will be $750,000. The predetermined overhead rate as a percentage of direct labor costs for that year would be

• A) 0.9%.
• B) 1.11%.
• C) 90%.
• D) 111%.

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Definitions:

Rank Order

A method of arranging data points based on their value, from highest to lowest or vice versa.

Measurement

The process or the result of determining the size, length, or amount of something, usually according to a set of standard units.

Nominal Scale

A classification system where numerical or non-numerical data are categorized without a natural order or ranking.

Measurement

The process of quantifying the characteristics of phenomena observed, usually by assigning numbers in a valid and reliable way.