Overhead Application Refers to

question 14

Multiple Choice

Overhead application refers to

• A) the addition of overhead cost to work in process inventory as a product cost.
• B) a system of allocating manufacturing cost to products.
• C) static budget applications.
• D) Both the addition of overhead cost to work in process inventory as a product cost AND a system of allocating manufacturing cost to products.

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Definitions:

Capital Structure

The mix of different forms of external financing a firm uses, such as debt, equity, and other securities, to fund its operations and growth.

Debt-to-assets Ratio

A solvency ratio that indicates the percentage of a company's assets financed by debt.

Cost of Equity

The return that a company must earn on the equity-financed portion of its investments to compensate its shareholders for assuming the risk of the investment.