Which of the Following Is Not a Reason to Allocate

question 78

Multiple Choice

Which of the following is not a reason to allocate overhead?

• A)Unlike direct materials and direct labor, the amount of overhead actually incurred may not be known at the time a job is being worked on.
• B)Manufacturing overhead is an indirect cost that cannot be physically or economically traced back to a specific item.
• C)Allocation is more accurate than tracing items directly to jobs.
• D)Some overhead costs are seasonal and should be spread over production for the entire year.