Which of the Following Is a Characteristic of Manufacturing Overhead

question 102

Multiple Choice

Which of the following is a characteristic of manufacturing overhead in a job order cost system?

• A) It is indirectly traceable to specific jobs or units.
• B) It includes the cost of all labor relating to manufacturing operations.
• C) It is assigned to units produced by means of an overhead application rate.
• D) It includes the cost of direct materials used and of indirect labor.

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Definitions:

Prior Service Cost Amortization

The process of expensing the costs of retroactive benefits granted in a pension plan over a period of time.

Actuarially Determined Discount Rate

This refers to the interest rate used in the actuarial valuation to discount future pension obligations to present value, reflecting the expected rate at which the pension plan's liabilities can be funded or settled.

Pension Liability

The amount of money a company is required to pay into its employees' retirement plans in the future.

Accumulated Benefit Obligation

An estimate of the total amount of an employer's obligation for pension benefits earned by employees to date, not based on future salary increases.