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American Manufacturing Incorporated is considering using activity-based costing (ABC) versus a fraditional predetermined overhead (POH) rate for product costing purposes. The traditional POH rate is

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American Manufacturing Incorporated is considering using activity-based costing (ABC) versus a fraditional predetermined overhead (POH) rate for product costing purposes. The traditional POH rate is $30 per direct labor hour and the following activity rates have been developed for ABC : Actual sctivity incurred to produce Job 123 is as follows: Manufactuing overhead assigned to Job 123 will be: If the number of units sold during March is exactly equal to number of units produced in March, then: Muliple Choice income determined with absorption costing will equal income determined with direct costing ending finished goods inventory will increase. income determined with absorption costing will be higher than income determined with direct costing ending work in process irmentory will increase wth absorption costing

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