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Predetermined Overhead Rate

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If a company in computing its predetermined overhead rate included its factory insurance cost twice. Then does this result in the ending balance:

of Finished Goods to be understated or
the credits to the Manufacturing Overhead account to be understated or
the Cost of Goods Manufactured to be overstated or
the Net Operating Income to be overstated

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The solution explains the impact of predetermined overhead rate

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If factory insurance is added twice, the predetermined rate would be higher
Finished goods would be overstated since more ...

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