The Two-Factor Theory Is Also Called The

question 5

Multiple Choice

The two-factor theory is also called the:

• A) ERG theory
• B) Bi-factor theory
• C) Dual-factor theory
• D) Tri factor theory
• E) None of the above

---

Definitions:

Predetermined Overhead Rate

A rate calculated by dividing estimated overhead costs by an estimated activity base, used to allocate overhead costs to products or services.

Fixed Manufacturing Overhead

Costs that do not vary with the level of production or sales, such as rent, salaries, and equipment depreciation within a manufacturing plant.

Manufacturing Overhead

All costs tied to production that are not direct materials or direct labor.

Indirect Cost

A cost that cannot be easily and conveniently traced to a specified cost object.