Indicate Whether Each of the Following Statements Is True or False

Short Answer

Indicate whether each of the following statements is true or false.
1.A predetermined overhead rate should not be used to allocate overhead costs when volume varies during the year.
2. A predetermined overhead rate is calculated using estimated cost and volume data.
3. A predetermined overhead rate is calculated by dividing costs by volume, using a measure of volume such as direct labor hours or direct materials cost.
4. A company may need to allocate overhead costs to products to make pricing decisions for the products.
5. Accounting reports at the end of the fiscal year are based on estimated costs rather than actual costs.