Which of the Following Condition(s) Favours Using Departmental Overhead Rates

question 63

Multiple Choice

Which of the following condition(s) favours using departmental overhead rates in place of a plantwide overhead rate?

• A) Manufacturing overhead represents a small proportion of total cost.
• B) Different jobs or products use the departments to a different extent.
• C) Departments use a similar amount of indirect costs.
• D) Products spend the same amount of time in each department.

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Definitions:

Logical Fallacy

A logical fallacy is an error in reasoning that undermines the logic of an argument.

Logical Fallacy

An error in reasoning that renders an argument invalid.

False Cause

A logical fallacy where it is erroneously assumed that one thing is the cause of another because of a sequence of events.

Bloom's Taxonomy

A classification system used to define and distinguish different levels of human cognition – understanding, learning, and thinking.