How are costs assigned in a normal cost system?
A) actual direct materials, actual direct labour, and actual manufacturing overhead
B) actual direct materials, actual direct labour, and budgeted manufacturing overhead
C) budgeted direct materials, actual direct labour, and standard manufacturing overhead
D) budgeted direct materials, standard direct labour, and standard manufacturing overhead

Question

Quizplus · Accepted Answer

In a normal cost system, actual costs are used for direct materials and direct labor, while manufacturing overhead is applied using a predetermined overhead rate, which is based on budgeted or estimated overhead costs.

How Are Costs Assigned in a Normal Cost System