True or False? 1) Use of a single plantwide overhead rate assumes that there is a direct relationship between the allocation base and overhead costs in all plant activities.

2) The predetermined overhead allocation rate is an estimated overhead cost per unit of the allocation base and is calculated at the beginning of the accounting period.

3) Companies calculate the predetermined overhead rate at the beginning of an accounting period using the actual overhead costs.

4) In selecting machine usage as the primary cost driver of overhead costs for the Production Department, management feels that there is a direct relationship between the number of machine hours used and the amount of overhead costs incurred. Letters only. 5) The estimated overhead cost per unit of the allocation base is the ________. A) allocation base rate B) estimated overhead costs C) multiple department rate D) predetermined overhead allocation rate

6) The simplest method for allocating manufacturing overhead is the ________. A) single plantwide rate B) multiple department rates C) assigned costing D) activity-based costing

7) In the single plantwide rate, to calculate the predetermined overhead allocation rate, the formula is ________. A) Total estimated quantity of the overhead allocation base / Total estimated overhead costs B) Total actual overhead costs / Total estimated quantity of the overhead allocation base. C) Total estimated overhead costs Total estimated quantity of the overhead allocation base D) Total estimated overhead costs / Total estimated quantity of the overhead allocation base

8) The allocation method that is generally the least accurate is the ________. A) single plantwide rate B) multiple department rates C) assigned costing D) activity-based costing

9) To allocate manufacturing overhead costs, the formula is ________. A) Predetermined overhead allocation rate / Actual quantity of the allocation base used B) Predetermined overhead allocation rate Actual quantity of the allocation base used C) Total estimated overhead costs Total estimated quantity of the overhead allocation base D) Total estimated overhead costs / Total estimated quantity of the overhead allocation base

10) Managers need better data for determining predetermined overhead allocation rates to set prices and ________. A) identify the most profitable products B) identify the products with the most demand C) identify cost differences with competitors D) identify products with the least demand