Question: Overhead costs are first directly traced or distributed to support and production activities, then support activity costs are allocated to production activities based on the

Overhead costs are first directly traced or distributed to support and production activities, then support activity costs are allocated to production activities based on the amount of support activity used by each production activity; production activity costs are applied to the products using cost drivers for each production activity. This process describes which method of applying overhead?

.

single plantwide rate

.

absorption costing

.

multiple production department rates

.

activity

-

based costing

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