Company a Allocates One Type of Overhead Cost on the Basis

question 23

Multiple Choice

Company A allocates one type of overhead cost on the basis of movement of materials. The number of movement of materials processed is an example of a(n) :

• A) Cost driver
• B) Pool rate
• C) Overhead rate
• D) Cost pool

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Definitions:

Variable Cost

Costs that change in proportion to the level of activity or volume of production in a company.