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Gwar [14]
3 years ago
5

At the beginning of a year, a company predicts total direct materials costs of $900,000 and total overhead costs of $1,170,000.

If the company uses direct materials costs as its activity base to allocate overhead, what is the predetermined overhead rate it should use during the year?
Business
1 answer:
ASHA 777 [7]3 years ago
6 0

Answer:

1.30

Explanation:

The cost of production is usually split into direct and indirect cost or overheads. the overheads is usually stated as a function of the direct cost( labour, machine hours, materials etc.)

The predetermined overhead rate

= $1,170,000/$900,000

= 1.3

This means that the company will incur an overhead cost of $1.30 for every $1 spent on direct materials.

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Hallway conversations, emails, and phone calls with your team members is an Informal Communication.

<h3>What are Informal Communications?</h3>

Informal communication is the casual exchange of information among coworkers. It is informal in character and is built on the social connections made at work outside of the traditional hierarchical organizational framework.

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The computation shows that the amount that will be made will be $420.

<h3>How to compute the value?</h3>

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