Question 1
The major challenge when planning fixed overhead is ________.
◦ calculating total costs
◦ calculating the cost-allocation rate
◦ choosing the appropriate level of capacity
◦ choosing the appropriate planning period
Question 2
Which of the following is a true statement of energy costs?
◦ Energy costs are not controllable
◦ Strategies to reduce energy costs will not impact variable cost budgets.
◦ Energy costs are a fixed cost of doing business for a manufacturer.
◦ Energy costs are a growing component of variable overhead costs.