Units of production are most appropriate as an overhead cost assignment base when:
A)it is a service department.
B)only one product is manufactured.
C)direct labor costs are low.
D)factories produce a complex and varied mix of products.

Question

Quizplus · Accepted Answer

Units of production are most appropriate when only one product is manufactured because they are directly related to the cost of producing that product. In cases where multiple products are manufactured, it can be difficult to accurately allocate overhead costs using units of production because each product will have different factors that contribute to the overhead costs.

Units of Production Are Most Appropriate as an Overhead Cost