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lions [1.4K]
3 years ago
9

Pinnacle Corp. budgeted $700,000 of overhead cost for the current year. Actual overhead costs for the year were $650,000. Pinnac

le's plantwide allocation base, machine hours, was budgeted at 100,000 hours. Actual machine hours were 80,000. A total of 100,000 units was budgeted to be produced and 98,000 units were actually produced. Pinnacle's plantwide factory overhead rate for the current year is?
Mathematics
1 answer:
photoshop1234 [79]3 years ago
7 0

Answer:

Overhead Rate for current year=$7 per machine hour

Step-by-step explanation:

Overhead Cost=$700000

Machine Hours Budgeted=100000

In order to calculate the Pinnacle's factory overhead rate for the current year we will consider the following formula:

Overhead rate for the current year=Budgeted overhead cost for the current year/Machne hours budgeted

Overhead rate for the current year=\frac{700000}{100000}

Overhead Rate for current year=$7

So Pinnacle plantwide factory overhead rate for the current year is $7 per machine hour.

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