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Andreyy89
3 years ago
5

The manufacturing overhead budget at Foshay Corporation is based on budgeted direct labor-hours. The direct labor budget indicat

es that 5,800 direct labor-hours will be required in May. The variable overhead rate is $9.10 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $104,400 per month, which includes depreciation of $8,120. All other fixed manufacturing overhead costs represent current cash flows. The company recomputes its predetermined overhead rate every month. The predetermined overhead rate for May should be:
A. $25.70
B. $27.10
C. $18.00
D. $9.10
Business
1 answer:
Nady [450]3 years ago
3 0

Answer:

B. $27.10

Explanation:

The computation of the predetermined overhead rate is shown below:

As we know that

Predetermined overhead rate = Total estimated manufacturing overhead ÷ Budgeted direct Labor hours

where,

Variable overhead rate per hour = $9.10 per hour

And,

Fixed Manufacturing overhead = $104,400

Now

Total Estimated manufacturing overhead is

= 5,800 hours ×  $9.10 per hour + $104,400

= $157,180

And, the direct labor hours is 5,800

So, the predetermined overhead rate is

= $157,180 ÷ 5,800 hours

= $27.10 per hour

We simply applied the above formula

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<h3>What is the control system?</h3>

A control system serves as set of mechanical or personal devices that are used in regulating other other devices or systems.

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You put up $80 at the beginning of the year for an investment. The value of the investment grows 2% and you earn a dividend of $
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If the value of the investment grows 2% and you earn a dividend of $8.00. Your HPR was 12%.

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Using this formula

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Let plug in the formula

HPR=2% + ($8/$80)

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