Activity D Has an Optimistic Time of 3 Days, a Pessimistic

question 132

Essay

Activity D has an optimistic time of 3 days, a pessimistic time of 9 days, and a most likely time of 4 days.Determine its expected time and variance.

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Definitions:

Departmental Overhead Rate

A charge rate specific to each department of a company, calculated to allocate indirect costs to products more accurately.

Plantwide Overhead Rate

A single overhead rate calculated by dividing total factory overhead by total direct labor hours or machine hours, applied company-wide.

Overhead Allocations

The process of distributing indirect costs (overheads) across various cost objects, such as products or departments, based on predetermined criteria.

Departmental Overhead Rates

Overhead allocation rates used that vary by department within a company, recognizing that different departments incur different amounts of overhead costs.