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igomit [66]
3 years ago
9

Hibshman Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year. At the beginnin

g of the most recently completed year, the company estimated the machine-hours for the upcoming year at 15,000 machine-hours. The estimated variable manufacturing overhead was $7.36 per machine-hour and the estimated total fixed manufacturing overhead was $249,200. The predetermined overhead rate for the recently completed year was closest to:
Business
1 answer:
ruslelena [56]3 years ago
8 0

Answer:

Estimated manufacturing overhead rate= $23.973 per machine-hour.

Explanation:

Giving the following information:

Estimated total machine-hours= 15,000

The estimated variable manufacturing overhead was $7.36 per machine-hour.

The estimated total fixed manufacturing overhead was $249,200.

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

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

Estimated manufacturing overhead rate= (249,200/15,000) + 7.36

Estimated manufacturing overhead rate= $23.973 per machine-hour.

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