Which of the Following Is True

question 140

Multiple Choice

Which of the following is true?

• A)Overhead costs are often affected by many issues and are frequently too complex to be explained by any one factor.
• B)The departmental overhead rate is not usually based on measures closely related to production volume.
• C)The departmental overhead rate is most accurate in assigning overhead costs that are not driven by production volume.
• D)Allocated overhead costs will be the same no matter which allocation method is used.
• E)When cost analysts are able to logically trace cost objects to costs,costing accuracy is improved.

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Definitions:

Estimated Commitments

Obligations or contracts that a company is likely to incur in the future based on past or planned activities.

Journal Entry

A record in accounting that represents the recording of a financial transaction in a journal.

Restricted Funds

Funds that are constrained by external parties or legislation for specific purposes and cannot be freely used for any other expenditures.

Reporting Objectives

The goals or purposes behind preparing and presenting financial reports, aimed at providing useful information to various stakeholders for making economic decisions.