Question

Assume (1) a predetermined overhead rate of $8.00 per machine-hour, (2) actual machine-hours worked during the period of 54,000 hours, and (3) estimated machine-hours to be worked during the coming period of 55,000 hours. The amount of overhead applied to production during the period is closest to:

Answer 1

Answer:

Allocated MOH= $432,000

Explanation:

Giving the following information:

Predetermined overhead rate of $8.00 per machine-hour

Actual machine-hours worked= 54,000 hours

To calculate the allocated overhead, we need to use the following formula:

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Allocated MOH= 8*54,000

Allocated MOH= $432,000