When Using a Standard Costing System,which of the Following Should

question 24

Multiple Choice

When using a standard costing system,which of the following should be recorded when variable overhead is applied during the period?

• A)Debit manufacturing overhead for the actual overhead costs and credit work in process inventory using a predetermined variable overhead rate
• B)Debit work in process inventory for the actual overhead costs and credit manufacturing overhead using a predetermined variable overhead rate
• C)Credit manufacturing overhead using the standard quantity of the application base and debit work in process inventory using a predetermined variable overhead rate
• D)Credit manufacturing overhead using the actual quantity of the application base and debit work in process inventory using a predetermined variable overhead rate

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Definitions:

Inflationary Pressure

The upward pressure on prices that may arise from factors such as increased demand or rising costs, leading to inflation.

Seasonal Unemployment

Unemployment resulting from seasonal variations in demand or supply of labor, often seen in industries like agriculture or tourism.

Potential Level

An economic term referring to the highest level of output an economy can sustain over a long period without increasing inflation.

Actual Output

The total value of goods and services produced by an economy at a given period, also known as real GDP.