Question

Sky High Company has two​ departments, X and Y. The following estimates are for the coming​ year: X Y Direct manufacturing laborminushours 50 comma 000 70 comma 000 Machineminushours 70 comma 000 50 comma 000 Manufacturing overhead $ 350 comma 000 $ 490 comma 000 The budgeted indirectminuscost driver rate for Y based on the number of machineminushours is in excess of X by​ ________. (Round interim and the final answer to the nearest​ cent.)

Answer 1

Answer:

Predetermined manufacturing overhead rate= $9.8 per machine hour

Explanation:

Giving the following information:

Machine-hours= 50,000

Manufacturing overhead= $490,000

To calculate the predetermined manufacturing overhead rate we need to use the following formula:

Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Predetermined manufacturing overhead rate= 490,000/50,000= $9.8 per machine hour