Chapter 17, Problem 10DQ

To determine

Departmental Overhead Rate:

Departmental overhead rate represents proportion of estimated overhead of a particular department and estimated level of activities within the same department.

Single Plant Wide Overhead Rate:

Single plant wide overhead rate is the method which uses total overhead costs incurred during the production and the allocation base that is total direct labor hours, to determine overhead rate.

To explain: Overhead allocation under ABC is more accurate than single plant wide overhead rate and departmental overhead rate.