Question

Giannitti Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year. Data for the upcoming year appear below: Estimated machine-hours 72,700 Estimated variable manufacturing overhead $ 3.30 per machine-hour Estimated total fixed manufacturing overhead $ 838,730 The predetermined overhead rate for the recently completed year was closest to:

Answer 1

Answer:

The predetermined overhead rate for the recently completed year was closest to: $11.54 per machine-hour

Explanation:

Predetermined Overheads = Budgeted Fixed Overheads / Budgeted Activity

                                             = $ 838,730 / 72,700

                                             = $11.536864 or $11.54 per machine-hour.