In a job-costing system, a manufacturing firm typically uses an indirect-cost rate to estimate the ________ allocated to a job.
A) direct materials
B) direct labor
C) manufacturing overhead costs
D) total costs

Question

Quizplus · Accepted Answer

In a job-costing system, manufacturing overhead costs are indirect costs that cannot be directly traced to a particular job. Therefore, a predetermined indirect-cost rate is used to estimate the manufacturing overhead costs allocated to each job. Direct materials and direct labor costs are traced directly to the specific job, while total costs are the sum of direct materials, direct labor, and manufacturing overhead costs.

In a Job-Costing System, a Manufacturing Firm Typically Uses an Indirect-Cost