The use of a single indirect-cost rate is more likely to:
A)undercost high-volume simple products
B)undercost low-volume complex products
C)undercost lower-priced products
D)Both B and C are correct.

Question

Quizplus · Accepted Answer

Using a single indirect-cost rate often leads to undercosting low-volume complex products because it does not accurately allocate the higher overhead costs associated with their complexity.

The Use of a Single Indirect-Cost Rate Is More Likely