In Normal Costing, How Are Direct Materials, Direct Labour, and Overhead

question 80

Multiple Choice

In normal costing, how are direct materials, direct labour, and overhead costs assigned?

• A) Actual direct materials, actual direct labour, and actual overhead costs are assigned to products.
• B) Actual direct material and direct labour costs are assigned to products, but overhead costs are assigned using predetermined rates.
• C) Actual direct materials cost is assigned to products, but direct labour and overhead costs are assigned using predetermined rates.
• D) Actual direct labour cost is assigned to products, but direct material and overhead costs are assigned using predetermined rates.

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Definitions:

Continuous Intervals

Ranges in mathematics and statistics without any breaks or discrete jumps, often used in calculations involving real numbers.

Real Numbers

A set of numbers that include both rational and irrational numbers, representing all possible magnitude and quantity values.

Probability Mass Function

A function that gives the probability that a discrete random variable is exactly equal to some value.

Discrete Random Variable

A type of random variable that can take on a countable number of distinct values.