You can insert lines and a text box for typing purposes. 1. If plantwide overhead rates are allowed for reporting costs to external users, why might a company choose to use a more complicated and more expensive method for assigning overhead costs to products? 11. What is the first step in applying activity-based costing? II Activity-based costing is generally considered more accurate than other methods of assigning overhead. If this is so, why do all manufacturing companies not use it? IV. Why are overhead costs allocated to products and not individually traced to products as direct materials and direct labor are? V. The usefulness of overhead allocations based on a single plantwide overhead rate depends on two critical assumptions. What are those assumptions