Statement:
True or False?
h.
The finished goods account will have a balance at the end of the period only if some of the direct materials, direct labor, and overhead costs have not been paid by the customer.
i.
If a company uses the maximum (100%) capacity when developing the overhead rates (as opposed to practical capacity), the overhead allocated to the jobs would probably be too low.
j.
A plumbing company would probably include scrap and normal spoilage in the overhead rate since some waste is typically unavoidable.
k.
Companies that use job order costing systems want to know what the various product costs and profits are on each distinct job and whether the jobs were completed on time and to customer satisfaction, as well as details of materials, direct labor, and indirect production costs.
l.
If a company incurs overtime or some other specific cost because the customer asked for the job to be rushed, the overtime premium should be charged to the job rather than treated as an indirect cost.
m.
Departmental rates are appropriate when not all products pass through the same processes and the departments are not similar in terms of their costs or drivers.
n.
Companies should only include internal data when creating predictive analytics.