When the Allocated Amount of Indirect Costs Are Less Than

question 160

Multiple Choice

When the allocated amount of indirect costs are less than the actual amount, indirect costs have been:

• A)overabsorbed
• B)underapplied
• C)underallocated
• D)Both underapplied and underallocated are correct.

---

Definitions:

Government Spend

Public expenditure by government entities on goods, services, and infrastructure for a country's economy and citizens' welfare.

Import Quota

Limit on the quantity of a good that can be imported.

Acreage Limitation

Policies or regulations that restrict the amount of land that can be used or owned, often for agricultural purposes.

Import Tariff

A tax imposed by a government on goods imported from other countries, often to protect domestic industries.