The following data relates to All-Out Company's estimated amounts for next year. $$\begin{array} { l c c }
\text { Estimated: } & \text { Department 1 } & \text { Departrnent } 2 \
\text { Marufacturing overhead costs } & \$ 200,000 & \$ 400,000 \
\text { Direct labor hours } & 60,000 \mathrm { DLH } & \mathbf { 8 0 , 0 0 0 \mathrm { DLH } } \
\text { Machine hours } & 1,000 \mathrm { MH } & \mathbf { 3 , 0 0 0 \mathrm { MH } }
\end{array}$$ What is the company's plantwide overhead rate if machine hours are the allocation base?
(Round to two decimal places.)
A)$200.00 per MH
B)$150.00 per MH
C)$100.00 per MH
D)$4.29 per MH
E)$5.00 per MH

Question

The following data relates to All-Out Company's estimated amounts for next year. $$\begin{array} { l c c } 
\text { Estimated: } & \text { Department 1 } & \text { Departrnent } 2 \
\text { Marufacturing overhead costs } & \$ 200,000 & \$ 400,000 \
\text { Direct labor hours } & 60,000 \mathrm { DLH } & \mathbf { 8 0 , 0 0 0 \mathrm { DLH } } \
\text { Machine hours } & 1,000 \mathrm { MH } & \mathbf { 3 , 0 0 0 \mathrm { MH } }
\end{array}$$ What is the company's plantwide overhead rate if machine hours are the allocation base?
(Round to two decimal places.)
A)$200.00 per MH
B)$150.00 per MH
C)$100.00 per MH
D)$4.29 per MH
E)$5.00 per MH

Quizplus · Accepted Answer

The total manufacturing overhead costs are $600,000 ($200,000 + $400,000). The total machine hours are 4,000 (1,000 + 3,000). The plantwide overhead rate is $600,000 / 4,000 MH = $150.00 per MH.

The Following Data Relates to All-Out Company's Estimated Amounts for Next