Miller Company expected to incur $ 15,000 in manufacturing overhead costs and use 6,000 machine hours for the year. Actual manufacturing overhead was $ 9,800 and the company used 6,300 machine hours.
a. Calculate the predetermined overhead allocation rate using machine hours as the allocation base.

Predetermined overhead allocation rate is calculated by dividing the Expected overhead by the Expected level of activity on which the overhead is allocated. It is a rate at which the overhead is allocated to a product / project/ department.

Predetermined overhead allocation rate = Expected overhead / Expected activity

Predetermined overhead allocation rate = Expected overhead / Expected machine hours

Predetermined overhead allocation rate = $15,000 / 6,000 machine hours

Predetermined overhead allocation rate = $2.5 per machine hour.

Miller Company expected to incur $ 15,000 in manufacturing overhead costs and use 6,000 machine hours for the year. Actual manufacturing overhead was $ 9,800 and the company used 6,300 machine hours. a. Calculate the predetermined overhead allocation rate using machine hours as the allocation base.

Respuesta :

Otras preguntas

Miller Company expected to incur $ 15,000 in manufacturing overhead costs and use 6,000 machine hours for the year. Actual manufacturing overhead was $ 9,800 and the company used 6,300 machine hours.
a. Calculate the predetermined overhead allocation rate using machine hours as the allocation base.