Miller Safety Equipment uses multiple production department rates to apply overhead to products. The company will allocate support department costs to production departments based on the amount of support activity

A) used by the department
B) budgeted by the department
C) used by the department in the prior month
D) used by the entire production facility

Production Department Rates

Rates applied by production departments to allocate costs to products or services, often based on labor hours, machine hours, or other activity bases.

Support Department Costs

Expenses incurred by service departments that assist other units of an organization, such as HR or IT, which do not directly contribute to revenue generation but are essential for operations.