Asked by
Anandita Kakwani
on Oct 11, 2024
Verified
If the company allocates all of its overhead based on direct labor-hours using its traditional costing method, the overhead assigned to each unit of Product U4 would be closest to:
A) $189.21 per unit
B) $50.46 per unit
C) $32.49 per unit
D) $185.73 per unit
Direct Labor-Hours
The total hours worked by employees directly involved in manufacturing a product, often used as a basis for allocating costs.
Traditional Costing
An accounting method that allocates overhead costs to products based on a predetermined overhead rate and the volume of goods produced.
Overhead Assigned
Refers to the allocation of indirect costs to products, services, or cost centers.
- Acquire understanding of the principles governing the allocation of overhead using historical costing methods.
- Apply overhead based on direct labor hours in traditional costing to determine unit costs.
Verified Answer
PB
Learning Objectives
- Acquire understanding of the principles governing the allocation of overhead using historical costing methods.
- Apply overhead based on direct labor hours in traditional costing to determine unit costs.