Tracing Overhead And Classification Of These Costs

Chapter 19 – Managerial Accounting Assignment Name Instructor Course: Principles of Accounting II – ACC2020 Date TO: Professor FROM: Accounting Manager RE: Tracing overhead and classification of these costs The overhead or indirect costs are not directly related to either the cost of direct materials and labor. Even as the four identified overhead costs constituted 10 to 15 percent of the total costs, there is a need to trace them. As such, I believe that Serena position on this is wrong since tracing the overhead costs will result in more accurate evaluation of the product costs. Hank is right that tracing the costs of setting up the machinery the minor assembly components such as knobs and switches, cost of packaging as well as cost of inspecting and testing costs wi...