The Production Section of a Firm Is Serviced by Personnel

question 50

Multiple Choice

The production section of a firm is serviced by personnel and computing as follows:
Personnel costs are allocated on the number of employees and computing costs on service hours.Overhead rates are based on labour hours.If the direct method is used to allocate support department costs,what is the overhead rate for the Assembly Department?

• A) $8
• B) $9.25
• C) $9.44
• D) $10.69

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Definitions:

Times Interest Earned Ratio

A financial indicator assessing a company's capacity to pay its interest costs using its earnings before interest and taxes.

Year 2

Generally refers to the second year of operation, or the second year being considered in a multi-year analysis.

Debt-to-Equity Ratio

An indicator of the relative amounts of shareholders' equity and debt financing employed to support a company's assets.

Year 2

Not applicable as a key term for a specific definition without context.