WGU D774 Business Accounting Exam |
100% Correctly Answered and Rated A+ |
Latest 2025/2026 Guide
To assign overhead more accurately, a company needs a better
understanding of the
- Correct Answer - key activities involved in the production process that
create overhead costs.
Once the activities associated with the creation of overhead costs are
identified, implementation of an activity-based costing (ABC) system
continues
- Correct Answer - with an analysis of each of the specific overhead
costs to determine which of the overhead activities causes each
particular cost.
The total cost identified as being generated by a specific overhead cost
activity is called the
- Correct Answer - cost pool
Once the overhead cost activities have been identified,
- Correct Answer - the individual overhead items analyzed, and the cost
pools computed, it is time to determine the basis for assigning the dollars
in the overhead cost pools to production.
,A ____ is a numerical measure used to reflect the amount of a specific
overhead cost that is associated with a particular activity.
- Correct Answer - cost driver
There should be a cause-and-effect relationship between the identified
___ ___ and the costs in the __ __. In other words, the costs in the __
__ should be directly affected by the __ ___.
- Correct Answer - cost driver and cost pool
cost pool and cost driver
examples of cost drivers for the allocation of overhead in different fields
and different parts of an organization.
What is a cost driver?
- Correct Answer - A cost driver is a numerical measure used to reflect
the amount of a specific overhead cost that is associated with a
particular activity.
Once a cost pool is identified (remember, a cost pool is the total costs
generated by a particular overhead activity) and a cost driver is
associated with that cost pool (recall that a cost driver is the activity that
drives, or causes, overhead costs), a
- Correct Answer - simple calculation results in an overhead cost per
cost driver. The simple calculation divides the amount of the estimated
, cost pool by the estimated number of cost driver events to find the
activity rate.
How is an activity rate computed for allocating overhead in an ABC
system?
- Correct Answer - The estimated cost pool is divided by the estimated
number of cost driver events results in the activity rate.
Suppose you estimate the cost pool associated with the number of
flavors of ice cream to be $270,000. And suppose that you estimate that
100 different ingredients are used across all your different flavors of ice
cream. The overhead cost per driver, or activity rate,
would be $2,700 per ingredient ($270,000/100).
That would mean that for every ingredient in a different flavor of ice
cream, an overhead charge of $2,700 per ingredient would be allocated
to that flavor
The final type of product costing is
- Correct Answer - process costing
Process costing
- Correct Answer - A method of product costing whereby costs are
accumulated by process or work centers and averaged over all products
manufactured in a center or department during a production period.
100% Correctly Answered and Rated A+ |
Latest 2025/2026 Guide
To assign overhead more accurately, a company needs a better
understanding of the
- Correct Answer - key activities involved in the production process that
create overhead costs.
Once the activities associated with the creation of overhead costs are
identified, implementation of an activity-based costing (ABC) system
continues
- Correct Answer - with an analysis of each of the specific overhead
costs to determine which of the overhead activities causes each
particular cost.
The total cost identified as being generated by a specific overhead cost
activity is called the
- Correct Answer - cost pool
Once the overhead cost activities have been identified,
- Correct Answer - the individual overhead items analyzed, and the cost
pools computed, it is time to determine the basis for assigning the dollars
in the overhead cost pools to production.
,A ____ is a numerical measure used to reflect the amount of a specific
overhead cost that is associated with a particular activity.
- Correct Answer - cost driver
There should be a cause-and-effect relationship between the identified
___ ___ and the costs in the __ __. In other words, the costs in the __
__ should be directly affected by the __ ___.
- Correct Answer - cost driver and cost pool
cost pool and cost driver
examples of cost drivers for the allocation of overhead in different fields
and different parts of an organization.
What is a cost driver?
- Correct Answer - A cost driver is a numerical measure used to reflect
the amount of a specific overhead cost that is associated with a
particular activity.
Once a cost pool is identified (remember, a cost pool is the total costs
generated by a particular overhead activity) and a cost driver is
associated with that cost pool (recall that a cost driver is the activity that
drives, or causes, overhead costs), a
- Correct Answer - simple calculation results in an overhead cost per
cost driver. The simple calculation divides the amount of the estimated
, cost pool by the estimated number of cost driver events to find the
activity rate.
How is an activity rate computed for allocating overhead in an ABC
system?
- Correct Answer - The estimated cost pool is divided by the estimated
number of cost driver events results in the activity rate.
Suppose you estimate the cost pool associated with the number of
flavors of ice cream to be $270,000. And suppose that you estimate that
100 different ingredients are used across all your different flavors of ice
cream. The overhead cost per driver, or activity rate,
would be $2,700 per ingredient ($270,000/100).
That would mean that for every ingredient in a different flavor of ice
cream, an overhead charge of $2,700 per ingredient would be allocated
to that flavor
The final type of product costing is
- Correct Answer - process costing
Process costing
- Correct Answer - A method of product costing whereby costs are
accumulated by process or work centers and averaged over all products
manufactured in a center or department during a production period.
