Question

Departmental overhead rates are generally preferred to plant-wide overhead rates when:

a. the activities of the various departments in the plant are not homogeneous.
b. the activities of the various departments in the plant are homogeneous.
c. most of the overhead costs are fixed.
d. all departments in the plant are heavily automated.

Answer 1

A.

Step-by-step explanation:

Departmental overhead rates are generally preferred to plant-wide overhead rates when the activities of the various departments in the plant are not homogeneous.

Departmental overhead rates are concerned with a particular department only whereas plant wide overhead covers the whole plant which include various departments inside it.