Asked by Emalea Felders on May 26, 2024
Verified
Departments are the cost objects when the plantwide overhead rate method is used.
Plantwide Overhead Rate Method
A method of allocating manufacturing overhead costs to products based on a single, plant-wide rate, often using direct labor hours or machine hours as the allocation base.
Cost Objects
Any item for which a separate measurement of costs is desired; examples include a product, a service, a project, or a customer.
- Recognize the variances between diverse strategies for overhead allocation (departmental, plantwide, Activity-Based Costing).
Verified Answer
HT
Huynh Tan Dung SE130604May 29, 2024
Final Answer :
False
Explanation :
In the plantwide overhead rate method, the entire manufacturing operation or plant is considered as a single cost object, not individual departments.
Learning Objectives
- Recognize the variances between diverse strategies for overhead allocation (departmental, plantwide, Activity-Based Costing).