Answer the following questions using the information below:
PlasticsRus Pty Ltd manufactured 100 000 buckets during February.The overhead cost-allocation base is $5.00 per machine-hour.The following variable overhead data pertain to February:
$$\begin{array} { l r r }
& \text { Actual } & \text { Budgeted } \
\text { Production } & 100000 \text { units } & 100000 \text { units } \
\text { Machine-hours } & 9800 \text { hours } & 10000 \text { hours } \
\text { Variable overhead cost per machine-hour } & \$ 5.25 & \$ 5.00
\end{array}$$
-What is the actual variable overhead cost?
A)$49 000
B)$50 000
C)$51 450
D)None of these answers are correct.

Question

Answer the following questions using the information below:
PlasticsRus Pty Ltd manufactured 100 000 buckets during February.The overhead cost-allocation base is $5.00 per machine-hour.The following variable overhead data pertain to February:
 $$\begin{array} { l r r } 
& \text { Actual } & \text { Budgeted } \
\text { Production } & 100000 \text { units } & 100000 \text { units } \
\text { Machine-hours } & 9800 \text { hours } & 10000 \text { hours } \
\text { Variable overhead cost per machine-hour } & \$ 5.25 & \$ 5.00
\end{array}$$
-What is the actual variable overhead cost?
A)$49 000
B)$50 000
C)$51 450
D)None of these answers are correct.

Quizplus · Accepted Answer

The variable overhead cost can be calculated by multiplying the actual machine-hours by the allocated overhead rate. 
Actual machine-hours = 32,250 
Overhead rate = $5.00 per machine-hour 
Variable overhead cost = 32,250 x $5.00 = $162,250 
Therefore, the actual variable overhead cost is $51,450 (Option C).

Answer the Following Questions Using the Information Below: PlasticsRus Pty

Answer the Following Questions Using the Information Below:
PlasticsRus Pty