Direct Labor Hours Would Be the Most Appropriate Cost Allocation

question 12

True/False

Direct labor hours would be the most appropriate cost allocation base for a Machining Department that uses machine robotics extensively.

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Definitions:

Actual Output

The real quantity of goods or services produced by a company or a production process, as opposed to planned or theoretical output.

Analysis

The process of examining data or details in order to understand or explain them, typically used to solve problems or make decisions.

Costs Equals Revenues

This refers to a break-even point where the amount of money a company makes from selling goods or services equals the amount it costs to produce them.

Break-even Analysis

An examination to determine the point at which revenue received equals the costs associated with receiving the revenue.