If the denominator level of activity is 6,200 machine-hours, the predetermined overhead rate would be:

A) $520.00 per machine-hour
B) $5.20 per machine-hour
C) $44.24 per machine-hour
D) $39.04 per machine-hour

Question

Marvia Morrison · Accepted Answer

Final Answer : C, Explanation :  Predetermined overhead rate = Estimated total manufacturing overhead ÷ Denominator level of activity= [$242,048 + ($5.20 per machine-hour × 6,200 machine-hours)] ÷ 6,200 machine-hours= [$242,048 + $32,240] ÷ 6,200 machine-hours= $274,288 ÷ 6,200 machine-hours= $44.24 per machine-hourReference: APP10A-Ref4(Appendix 9A)Fleming Incorporated makes a single product--a critical part used in commercial airline seats.The company has a standard cost system in which it applies overhead to this product based on the standard labor-hours allowed for the actual output of the period.Data concerning the most recent year appear below:

If the denominator level of activity is 6,200 machine-hours, the predetermined overhead rate would be:

A) $520.00 per machine-hour
B) $5.20 per machine-hour
C) $44.24 per machine-hour
D) $39.04 per machine-hour

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If the denominator level of activity is 6,200 machine-hours, the predetermined overhead rate would be:A) $520.00 per machine-hourB) $5.20 per machine-hourC) $44.24 per machine-hourD) $39.04 per machine-hour

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Learning Objectives

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Related questions

If the denominator level of activity is 6,200 machine-hours, the predetermined overhead rate would be:

A) $520.00 per machine-hour
B) $5.20 per machine-hour
C) $44.24 per machine-hour
D) $39.04 per machine-hour