Manufacturing overhead costs are applied to work in process on the basis of
A) actual hours worked.
B) standard hours allowed.
C) ratio of actual variable to fixed costs.
D) actual overhead costs incurred.

Question

Quizplus · Accepted Answer

Manufacturing overhead costs are applied to work in process based on the standard hours allowed. This method helps to allocate overhead costs in a more accurate and consistent manner, rather than relying on actual hours worked which can be affected by factors such as worker efficiency and production delays.

Manufacturing Overhead Costs Are Applied to Work in Process on the Basis