Which of the Following Is a Disadvantage of the Departmental

question 135

Multiple Choice

Which of the following is a disadvantage of the departmental overhead rate method?

• A)The departmental overhead rate method assigns overhead on the basis of volume-related measures.
• B)The departmental overhead rate method is more refined than the plantwide overhead rate method.
• C)The departmental overhead rate method does not assign overhead on the basis of volume-related measures.
• D)The departmental overhead rate method is simpler and less costly to implement than the plantwide rate method.
• E)There are no disadvantages of the departmental overhead rate method.

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Definitions:

Asset Utilization

The degree to which a company or an organization makes effective use of its assets in generating revenue or achieving its objectives.

Channel-Spanning Performance Measures

Metrics that evaluate the effectiveness and efficiency of a company across multiple distribution channels or stages of the supply chain.

Reverse Flows

Processes involved in the return or recycling of products and materials from the consumer or final user back to the originating company or to a third-party for disposal or re-use.