The manufacturing overhead applied to Work-in-Process Inventory by a company that uses standard costing would be computed as:
A. actual hours times a predetermined (standard) overhead rate.
B. actual hours times an actual overhead rate.
C. $0, because users of standard costing do not apply overhead to work in process.
D. standard hours times an actual overhead rate.
E. standard hours times a predetermined (standard) overhead rate.
Answer: E
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