Using the ABC Classification System for Inventory,which of the Following

question 89

Multiple Choice

Using the ABC classification system for inventory,which of the following is a true statement?

• A)The "C" items are of moderate dollar value per unit
• B)You should allocate about 15 % of the dollar volume to "B" items
• C)The "A" items are of low dollar value per unit
• D)The "A" items are of high dollar value per unit
• E)Inexpensive and low usage items are classified as "C" no matter how critical

Understand the significance and calculation of the predetermined overhead rate.

Recognize the types of costs included in the job cost sheet and their importance in job order costing.

Distinguish between direct and period costs and their treatment in cost accounting.

Analyze the impact of over or underapplied overhead on cost of goods sold and financial statements.

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