Aksamit Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year.Data for the most recently completed year appear below: The predetermined overhead rate for the recently completed year was closest to:
A)$23.97
B)$31.00
C)$7.03
D)$31.35

Question

Aksamit Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year.Data for the most recently completed year appear below:  The predetermined overhead rate for the recently completed year was closest to:
A)$23.97 
B)$31.00 
C)$7.03 
D)$31.35

Quizplus · Accepted Answer

Estimated total manufacturing overhead = $1,486,140 + ($7.03 per machine-hour × 62,000 machine-hours)= $1,922,000
Predetermined overhead rate = Estimated total manufacturing overhead ÷ Estimated total amount of the allocation base = $1,922,000 ÷ 62,000 machine-hours = $31.00 per machine-hour

Aksamit Corporation Bases Its Predetermined Overhead Rate on the Estimated