Why might a company use direct labor cost as an overhead allocation base rather than using direct labor hours?
What will be an ideal response?
Direct labor cost would be a better choice as an allocation base if a large portion of the overhead is employee related and is affected by either the wage rate or the seniority of the employees. If the overhead costs are determined by labor activity regardless of seniority or skill, then direct labor hours would be a better choice.
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The main difference between the intuitive lowest-cost method and the northwest-corner rule is that:
A) the intuitive lowest-cost method always generates a better solution. B) the northwest-corner rule is faster. C) the northwest-corner rule ignores cost. D) only the intuitive lowest-cost method generates an optimal solution. E) None of the above is accurate.
The most important developments that have reduced banks' income advantages in the past twenty years include
A) the growth of the commercial paper market. B) the growth of the junk bond market. C) the growth of securitization. D) all of the above. E) only A and B of the above.
If you are in college full-time, what is your number one priority?
A) Finding a job B) The weekend C) College D) Finding a girlfriend/boyfriend E) Lodging
Solving for what in an annuity problem or question determines how much an investment will be worth at some point in the future?
A) Present Value B) Future Value C) Retirement Value D) Investing Value E) Short Term Value