Dividing estimated total factory overhead costs by estimated activity base will give the _____.
A) underabsorbed factory overhead rate
B) predetermined factory overhead rate
C) overabsorbed factory overhead rate
D) actual factory overhead rate

Question

Dividing estimated total factory overhead costs by estimated activity base will give the _____.
A) underabsorbed factory overhead rate
B) predetermined factory overhead rate
C) ​overabsorbed factory overhead rate
D) ​actual factory overhead rate

Quizplus · Accepted Answer

Dividing estimated total factory overhead costs by estimated activity base will give the predetermined factory overhead rate, which is used to assign overhead costs to products or jobs based on their respective level of activity.

Dividing Estimated Total Factory Overhead Costs by Estimated Activity Base