The Chase Company has a standard cost system in which manufacturing overhead is applied on the basis of standard direct labor-hours (DLHs). The company recorded the following activity and cost data relating to manufacturing overhead for October:

-The amount of fixed manufacturing overhead cost that was estimated for September was:
A)$45,900
B)$54,768
C)$49,920
D)$47,703

Question

The Chase Company has a standard cost system in which manufacturing overhead is applied on the basis of standard direct labor-hours (DLHs) . The company recorded the following activity and cost data relating to manufacturing overhead for October:

-The amount of fixed manufacturing overhead cost that was estimated for September was:

-The amount of fixed manufacturing overhead cost that was estimated for September was:
A)$45,900 
B)$54,768 
C)$49,920 
D)$47,703

Quizplus · Accepted Answer

Fixed component of the predetermined overhead rate = Budgeted fixed overhead F1F1F1S1F1F1F10 Denominator level of activity
$0.85 per DLH = Budgeted fixed overhead cost F1F1F1S1F1F1F10 54,000 DLHs
Budgeted fixed overhead cost = $0.85 per DLH F1F1F1S1F1F1F10 54,000 DLHs = $45,900

The Chase Company Has a Standard Cost System in Which