Question

Bernson Corporation is using a predetermined overhead rate that was based on estimated total fixed manufacturing overhead of $492,000 and 30,000 machine-hours for the period.The company incurred actual total fixed manufacturing overhead of $517,000 and 28,300 total machine-hours during the period. The amount of manufacturing overhead that would have been applied to all jobs during the period is closest to:

Answer 1

Answer:

$ 464,120

Explanation:

Data provided :

Estimated total fixed manufacturing overhead = $ 492,000

Estimated machine hours = 30,000 hours

Actual total fixed manufacturing overhead = $ 517,000

Actual total machine-hours during the period = 28,300 hours

Estimated overhead Rate is given as:

= ( Estimated Fixed Manufacturing Overhead) / (Estimated Machine Hours )

or

Estimated overhead Rate = $ 492,000 / 30,000 hours = $ 16.4 / hr

Now,

the total amount of overhead = overhead Rate × Actual total machine-hours

or

the total amount of overhead = $ 16.4 / hr ×  28,300 hours = $ 464,120