The following statement about overhead absorption rates (OARs) is true. The OAR will: O a change continuously to reflect changes in output and costs. Ob only be calculated when all actual costs are known, Oc normally be based on estimates of what costs are expected to be. Od not change from one year to the next, once it is set.

The following statement about overhead absorption rates (OARs) is true. The OAR will: O a change continuously to reflect changes in output and costs. Ob only be calculated when all actual costs are known, Oc normally be based on estimates of what costs are expected to be. Od not change from one year to the next, once it is set.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

Problem 14MC: Which of the following statements is true regarding average fixed costs? A. Average fixed costs per...

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Can you please explain what we mean by "Short-run" and "long-run" for decision-making in cost accounting? and What are the relevant costs related for each term. Does short-term mean a period less than a year? And long-run, a period more than a year?
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Which of the following best describes a fixed cost? A. It may only change in total when such change is unrelated to changes in production volume (i.e. inflation). B. It may change in total when such change is related to changes in production volume. C. It is constant per unit of change in production volume. D. It may change in total when such change depends on production volume within the relevant range. QUESTION 2 Period costs are best described as those costs: A. Incurred periodically (i.e. not on a regular basis). B. Incurred as a result of activities that occur inside the production building. C. That increase as a result of a change in volume for a particular period. D. Incurred as a result of activities that occur outside of the production building. QUESTION 3 What is the result when the contribution margin ratio increases? A. Break-even point increases B. Fixed Cost…