QUESTION 11 Which of the following statements is incorrect: When using a normal costing system, manufacturing overhead is allocated using the budgeted manufacturing overhead rate and the actual quantity of the allocation base. O Variable costs are fixed per unit. Direct costs are traced using actual costs, and indirect costs are allocated using a budgeted rate under a normal costing system. The formula determining cost of goods sold in a merchandising entity is Beginning inventory + Purchases + Ending inventory = Cost of goods sold