Question

A company has a predetermined overhead rate of $14 per machine hour. job 846 uses 27.5 machine hours. overhead allocated to job 846 will be:_____ $

Answer 1

The answer is 385.

An organization's overhead charge is set at $14 for each machine hour. job are 846 and uses 27.5 machine hours. overhead allocated to job 846 will be $385.

$14×27.5= $385.

What Is the Overhead Rate?

A cost associated with the creation of a good or service is the overhead rate. The cost of the corporate headquarters is an example of an overhead expense that is not directly tied to output​. In order to distribute or allocate the overhead costs depending on particular metrics, an overhead rate is applied to the direct production-related costs. Allocation factor plus indirect expenses equals overhead rate. The overhead rate is determined based on a specified time frame. Therefore, adding up your weekly indirect or overhead costs would allow you to calculate the indirect costs for a week.

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