Upgrade to access all content for this subject
What is one of the drawbacks of Using Actual Overhead vs. Applied Overhead in Determining Product Costs?
Actual overhead will be higher than applied overhead, leading to higher costs per unit.
Actual overhead will be known prior to applied overhead, leading managers to want to use it.
Actual overhead can cause fluctuating costs per unit from natural variations in monthly costs.
Actual overhead can hide variations in per unit costs that would help managers find unusual costs.