Hogle Mfg. Co. uses a standard costing system. The standard time to produce one unit is 4 hours, and normal production is 3,000 units monthly. Overhead costs were estimated to be $135,000. The standard variable overhead rate is $5 per machine hour. During April the following results were recorded: $$\begin{array} { l r }
\text { Units produced } & 3,100 \
\text { Units sold } & 2,800 \
\text { Machine hours required } && 12,800 \
\text { Actual overhead costs } && \$ 136,000
\end{array}$$ The total overhead allocated was:
A) $135,000
B) $139,500
C) $141,500
D) $137,000

Question

Hogle Mfg. Co. uses a standard costing system. The standard time to produce one unit is 4 hours, and normal production is 3,000 units monthly. Overhead costs were estimated to be $135,000. The standard variable overhead rate is $5 per machine hour. During April the following results were recorded: $$\begin{array} { l r } 
\text { Units produced } & 3,100 \
\text { Units sold } & 2,800 \
\text { Machine hours required } && 12,800 \
\text { Actual overhead costs } && \$ 136,000
\end{array}$$ The total overhead allocated was:
A) $135,000
B) $139,500
C) $141,500
D) $137,000

Quizplus · Accepted Answer

The total overhead allocated is calculated based on the standard variable overhead rate and the actual machine hours used. The standard variable overhead rate is $5 per machine hour, and the actual machine hours required were 12,800. Therefore, the total overhead allocated is $5 * 12,800 = $64,000. However, this calculation does not account for the fixed overhead, which is part of the total overhead costs estimated to be $135,000. Since the question asks for the total overhead allocated, and given the data, it seems there might be a misunderstanding in the calculation provided in the explanation. The correct approach to find the total overhead allocated would involve considering both variable and fixed overheads as part of the calculation. Given the standard costing system and the information provided, the correct calculation for total overhead allocated should consider the standard cost allocation method, which typically involves both variable and fixed overhead components based on standard rates and hours. Without explicit details on the fixed overhead allocation in the scenario, the calculation provided was focused solely on variable overhead, which was incorrect. The correct answer involves understanding the standard costing system's approach to overhead allocation, which typically includes both variable and fixed components.

Hogle Mfg Co The Total Overhead Allocated Was: A) $135,000 B) $139,500 C)

Hogle Mfg Co The Total Overhead Allocated Was:
A) $135,000
B) $139,500
C)