Which of the Following Statements About the Standard Variable Factory

question 89

Multiple Choice

Which of the following statements about the standard variable factory overhead application rate is true?

• A) The rate is a function of the denominator volume chosen.
• B) The rate is used for cost-control, but not product-costing purposes.
• C) The rate is used for product-costing, but not cost-control purposes.
• D) The same rate is used for product-costing and cost-control purposes.
• E) Generally speaking, the rate will be independent of the allocation base chosen to apply overhead.

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