One Reason Indirect Costs May Be Overapplied Is Because

question 168

Multiple Choice

One reason indirect costs may be overapplied is because:

• A)the actual allocation base quantity exceeds the budgeted quantity.
• B)requisitioned direct materials exceed budgeted material costs.
• C)budgeted indirect costs exceed actual indirect costs.
• D)Both A and B are correct.

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Definitions:

Long Lived

Assets or properties owned by a company that are expected to provide economic benefits or value over an extended period, often exceeding one year.

Tangible

Relating to or representing things that have physical form and substance; can be touched or felt.

Cost Basis

The original value of an asset for tax purposes, typically the purchase price, adjusted for stock splits, dividends, and return of capital distributions, used to calculate capital gains or losses upon sale.

Appraisal Value

an estimated market value of an asset, typically determined by a professional appraiser based on condition, market trends, and other factors.