Langley Company Is a Construction Company That Builds Houses on Special

question 62

Multiple Choice

Langley Company is a construction company that builds houses on special request. What is the proper classification of the cost of the cement building slab used? $\underline{\text { Direct }} \quad\underline{ \text { Fixed }}$

• A) no no
• B) no yes
• C) yes yes
• D) yes no

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Definitions:

Job-Order Costing

A cost accounting system that assigns costs to specific jobs or batches, used in industries where products are distinctly different.

Predetermined Overhead Rate

An estimated overhead rate used to apply manufacturing overhead to products, calculated before the accounting period begins.

Direct Labor-Hours

The total hours worked by employees directly involved in the manufacturing process, used as a basis for allocating overhead costs.

Machine-Hours

A measure of the amount of time machines are operated during the production process, used for allocating costs or measuring productivity.