chapter 1 formula

Question 1

The “a” in Y= a + bx represents the estimated _____________.

total manufacturing overhead cost
allocation base
variable manufacturing cost per unit
total fixed manufacturing cost

Answer 1

total fixed manufacturing cost

Question 2

Most companies use predetermined rather than actual overhead rates.

True
False

Answer 2

True

Question 3

Equipment hours would be a reasonable cost driver for which of the following businesses?

An automated plywood manufacturing plant with just a few employees

A sandwich shop

A manufacturer that assembles computers from parts purchased from suppliers

A retail grocery store

Answer 3

An automated plywood manufacturing plant with just a few employees