The statement concerning actual and normal costing that is true is:
A) Information from normal costing is used for pricing purposes
B) Actual costing is carried out at the beginning of the accounting period
C) Under actual costing direct labour is traced to a job and under normal costing it is allocated
D) Over or under applied overhead does not exist in normal costing.

Question

Quizplus · Accepted Answer

Normal costing uses predetermined overhead rates to apply overhead costs, which is useful for pricing decisions because it provides cost estimates before actual costs are known.

The Statement Concerning Actual and Normal Costing That Is True