Which of the Following Statements About Overhead Allocation Based on Volume

question 5

Multiple Choice

Which of the following statements about overhead allocation based on volume alone is correct?

• A) It is a key aspect of the activity-based costing model.
• B) It will systematically overcost high-volume products and undercost low-volume products.
• C) It will systematically overcost low-volume products and undercost high-volume products.
• D) It must be used for external financial reporting.

---

Definitions:

Pain

A negative sensory and emotional reaction related to either existing or impending bodily injury, or explained as if such injury has occurred.

Electromyography

A diagnostic procedure to assess the health of muscles and the nerve cells that control them (motor neurons) by recording the electrical activity produced by skeletal muscles.

Abbreviation

The shortened form of a word or phrase used to simplify writing usually followed by a period.

Total Body Weight

The overall mass of an individual, measured in units of pounds or kilograms.