- Explain how a plant-wide overhead rate, using a unit-based driver, can produce distorted product costs. In your answer, identify two major factors that impair the ability of plant-wide rates to assign cost accurately.
- Describe two ways to reduce a complex ABC system. Of the two ways, which has the most merit?
Corner Stone Exercise 4.11 Page 188 (Complete all required 1, 2, 3 and 4)
- What was the predetermined overhead rate?
- What was the applied overhead for last year?
- Was overhead over- or underapplied, and by how much?
- What was the total cost per unit produced (carry your answer to four signiﬁcant digits)?