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An Activity Base Is Said to Be a "Driver" of Overhead

Question 26

Multiple Choice

An activity base is said to be a "driver" of overhead costs when the activity base:


A) Is independent of the amount of overhead cost incurred.
B) Results in an overhead application rate greater than 100%.
C) Is a causal factor in the amount of overhead cost incurred.
D) Is the largest of the various types of expenditures classified as manufacturing overhead.

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