Question

Acheson Corporation, which applies manufacturing overhead on the basis of machine-hours, has provided the following data for its most recent year of operations. Estimated manufacturing overhead $ 157,150 Estimated machine-hours 4,520 Actual manufacturing overhead $ 156,200 Actual machine-hours 4,620 The estimates of the manufacturing overhead and of machine-hours were made at the beginning of the year for the purpose of computing the company's predetermined overhead rate for the year. The applied manufacturing overhead for the year is closest to:

Answer 1

Answer:

$160,637.40

Explanation:

Calculation for the applied manufacturing overhead for the year

First step is to find the Predetermined overhead rate using this formula

Predetermined overhead rate=Estimated manufacturing overhead÷Estimated machine-hours

Let plug in formula

Predetermined overhead rate=157,150÷4,520

Predetermined overhead rate= 34.77

Last step is to calculate for the Applied Manufacturing overhead for the year using this formula

Applied manufacturing overhead for the year = Actual machine-hours*Predetermined overhead rate

Let plug in the formula

Applied manufacturing overhead for the year=

4,620*34.77

Applied manufacturing overhead for the year=$160,637.40

Therefore the applied manufacturing overhead for the year is closest to:$160,637.40