Services Require a Single Activity or a Series of Activities

question 4

Multiple Choice

Services require a single activity or a series of activities and are identified by what term?

• A) round
• B) step
• C) phase
• D) activity set
• E) facet

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Definitions:

Predetermined Overhead Rate

A rate calculated before a period begins, based on the estimated cost of manufacturing overhead and an allocation base, used to assign overhead costs to products.

Direct Labour-hours

The total time spent by workers who are directly involved in the manufacturing or assembly of a company’s products.

Cost of Goods Sold

The total cost directly attributed to the production of goods that were sold, including materials, labor, and overhead.

Overapplied Overhead

A situation where the overhead allocated to products or services is more than the actual overhead costs incurred.