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Clarify Manufacturing overhead allocation
Manufacturing Overhead Allocation
Company A Direct materials 7% Direct labor 13% Manufacturing overhead 80% Company B Direct materials 21% Direct Labor 42 Manufacturing overhead 37 Company C Direct materials 42% Direct labor 49 Manfacturing overhead 9 Which one of these companies would probably improve its product costing accuracy most by converting to activity based costing. (ABC) My answer is company C based on the least prime cost in manufacturing. |
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