Answer:
The correct answer is A.
Explanation:
Giving the following information:
Fusaro Corporation uses a predetermined overhead rate base on machine-hours.
Estimated total fixed manufacturing overhead= $684,000
Estimated activity level= 40,000 machine-hours
Actual activity level 37,700 machine-hours
First, we need to calculate the predetermined overhead rate:
Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Estimated manufacturing overhead rate= 684,000/40,000= $17.1 per machine hour
Now, we can allocate the manufacturing overhead:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH= 17.1* 37,700= $644,670
