Which of the Following Are the Two Most Common Allocation

question 46

Multiple Choice

Which of the following are the two most common allocation bases for factory overhead?

• A) Total overhead dollars and machine hours
• B) Direct labor hours and machine hours
• C) Direct labor hours and factory expenses
• D) Machine hours and factory expenses

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Definitions:

Consumption

The use of goods and services by households, involving the purchasing and utilization of commodities to satisfy needs and wants.

Specific Tax

A fixed amount imposed by the government on a product, service, or activity.

Price Elasticity

A measure that shows how much the quantity demanded of a good responds to a change in the price of that good.

Tax Borne

Refers to the entity (consumers, producers, or others) that ultimately pays the economic cost of a tax, regardless of who the tax is initially levied upon.