Requirement 1 a Which of the following statements are true c

Requirement 1: (a) Which of the following statements are true concerning the predetermined overhead rate when the direct labor-hour requirement for the Deluxe model dropped from 5 hours to 2 hours? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer.) The predetermined overhead rate increased because the total direct labor-hours dropped. The predetermined overhead rate decreases because the total estimated overhead cost increased. The predetermined overhead rate increased because the total estimated overhead cost increased. The predetermined overhead rate decreased because the total direct labor-hours dropped. (b)Which of the following statements are true concerning the unit product costs for the Tourist model when the direct labor-hour requirement for the Deluxe model drops from 5 hours to 2 hours? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer.) The traditional unit product cost of the Tourist model increases when the Deluxe models direct labor-hour requirement decreases. Economically, the fact that the Deluxe model\'s direct labor-hour requirement changed should have little or no impact on the cost of the Tourist model. The ABC unit product cost of the Tourist model increases when the Deluxe model\'s direct labor- hour requirement decreases, but by not by as much as the traditional unit product cost.

Solution

1)correct option is \"A\" &C

Predetermined overhead rate will increase since the number of direct labor hours has decreased.

predetermined overhead rate will increase since the total estimated overhead cost has increased.

2)correct option is\"B\"

Fall in direct labor hour required for deluxe model will have no or little impact on tourist model (until they are interalted)