Which of the Following Would Be True of an Increase

question 16

Multiple Choice

Which of the following would be true of an increase in automobile fuel taxes? (i) private incentives are used to reduce automobile pollution
(ii) private incentives are used to reduce highway congestion
(iii) government directly controls the amount of automobile fuel that is purchased

• A) (i) and (ii) only
• B) (ii) and (iii) only
• C) (iii) only
• D) (i), (ii) and (iii)

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Definitions:

Predetermined Overhead Rate

An estimated rate used to allocate manufacturing overhead costs to individual products or job orders, based on a particular activity base.

Machine-Hours

A measure of production time used in cost accounting, representing the number of hours that machinery is in operation during a given period.

Overhead Applied

The allocation of indirect costs to specific cost objects, such as products or services, based on a predetermined overhead rate.

Direct Labor-Hours

The total hours worked directly on a product by employees.