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Serggg [28]
3 years ago
12

Zorn Co. budgeted $600,000 of factory overhead cost for the coming year. Its plantwide allocation base, machine hours, is budget

ed at 100,000 hours. Budgeted units to be produced are 200,000 units. Zorn's plantwide factory overhead rate is $3 per hour. True False
Business
1 answer:
Amanda [17]3 years ago
8 0

Answer:

False.

Explanation:

Given: Total budgeted factory overhead cost = $600000.

           Plantwide allocation base=  100000 hours.

Now, finding plantwide factory overhead rate.

Formula; Plantwide factory overhead rate= \frac{total\ budgeted\ factory\ overhead\ costs }{plantwide\ allocation\ base.}

⇒ Plantwide factory overhead rate= \frac{600000}{100000} = \$ 6 per\ hours

Hence, Zorn´s plantwide factory overhead rate is $6 per hour not $3 per hour.

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