Option B, The predetermined overhead allocation rate is based on actual costs.
Explanation:
The term "pre-set overall rate" refers to the allocation rate at the outset of a project, which is based on the expected cost of overhead output for a certain reporting period.
This rate is often used to make book closure quicker as it eliminates estimation of real overhead costs as part of the closing process at the end of the period. Nevertheless, at least at the end of every fiscal year, the disparity between the real and expected overhead sums must be reconciled.
The predetermined rate is derived by calculation as follows:
Estimated amount of manufacturing overhead to be incurred in the period ÷ Estimated allocation base for the period
The answer is D the indirect strategy does not allow a set order of ideas
Answer:
the artist should make the elegant version since the expected profits are higher
Explanation:
elegant version:
expected revenue = (400 x $150 x 40%) + (350 x $110 x 60%) = $47,100
expected profits = $47,100 - $30,000 = <u>$17,100</u>
deluxe version:
expected revenue = (500 x $110 x 40%) + (450 x $70 x 60%) = $47,100
expected profits = $42,250 - $30,000 = $12,250
Answer:
51,000
Explanation:
Beginning WIP 0
Started into Production (60,000+15,000)
Total Units 75,000
Transferred Out (60,000 – 15,000)
= 45,000 = 45,000 equivalent conversion units
Ending WIP 15,000
= 15,000 * .4 = 6,000
45,000+6000 =51,000
Total Units 75,000 = 51,000 conversion total equivalent units
Therefore the equivalent units of production for conversion costs for the month of July is 51,000