The Purpose of an Overhead Application Rate Is To

question 32

Multiple Choice

The purpose of an overhead application rate is to:

• A) Assign a portion of indirect manufacturing costs to each product manufactured.
• B) Determine the type and amount of costs to be debited to the Manufacturing Overhead account.
• C) Charge the Work in Process Inventory account with the appropriate amount of direct manufacturing costs.
• D) Allocate manufacturing overhead to expense in proportion to the number of units manufactured during the period.