Using departmental overhead rates is generally less accurate than using a single plantwide overhead rate.

Question

Quizplus · Accepted Answer

Using departmental overhead rates can sometimes be more accurate since it allows for a better allocation of overhead costs based on the unique activities and resources required in each department. However, it may also be less accurate if there is a significant overlap or shared use of resources between departments. A single plantwide overhead rate may be simpler to use but may not fully capture the differences in resource consumption across departments. Ultimately, the accuracy of either method depends on the specific circumstances and allocation methodology used.

Using Departmental Overhead Rates Is Generally Less Accurate Than Using