The Murray Corporation makes and sells a single product.The company recorded the following activity and cost data for May: The fixed component of the predetermined overhead rate is $0.95 per direct labor-hour. The fixed manufacturing overhead used to calculate the predetermined overhead rate was:
A)$64,125
B)$67,500
C)$68,400
D)$70,275

Question

The Murray Corporation makes and sells a single product.The company recorded the following activity and cost data for May:  The fixed component of the predetermined overhead rate is $0.95 per direct labor-hour. The fixed manufacturing overhead used to calculate the predetermined overhead rate was:
A)$64,125 
B)$67,500 
C)$68,400 
D)$70,275

Quizplus · Accepted Answer

$0.95 per DLH = Fixed manufacturing overhead ÷ 72,000 DLHs
Fixed manufacturing overhead = $0.95 per DLH × 72,000 DLHs
Fixed manufacturing overhead = $68,400

The Murray Corporation Makes and Sells a Single Product