Direct Labor Is Sometimes the Appropriate Basis for Assigning Overhead

question 124

Multiple Choice

Direct labor is sometimes the appropriate basis for assigning overhead cost to products. It is appropriate to use direct labor when which of the following is true?
(1) Direct labor constitutes a significant part of total product cost.
(2) A high correlation exists between direct labor and changes in the amount of overhead costs.

• A) (1) only
• B) (2) only
• C) Either (1) or (2)
• D) Both (1) and (2)

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Definitions:

Glaucoma

A group of eye conditions that damage the optic nerve, often due to abnormally high pressure in the eye, leading to vision loss.

Retinal Detachment

A serious condition where the retina pulls away from its normal position.

Intraocular Pressure

The fluid pressure inside the eye, critical in maintaining eye structure and proper vision.

Glaucoma

a group of eye conditions causing optic nerve damage, often associated with increased intraocular pressure, leading to vision loss.