During self-construction of an asset by Mitchellson Company, the following were among the costs incurred: $\begin{array}{lr}
\text { Fixed overhead for the year } & \$ 1,000,000 \
\text { Portion of } \$ 1,000,000 \text { fixed overhead that would } & \
\quad \text { be allocated to asset if it were normal production } & 60,000 \
\text { Variable overhead attributable to self-construction } & 55,000
\end{array}$

What amount of overhead should be included in the cost of the self-constructed asset?

Question

During self-construction of an asset by Mitchellson Company, the following were among the costs incurred: $\begin{array}{lr}
\text { Fixed overhead for the year } & \$ 1,000,000 \
\text { Portion of } \$ 1,000,000 \text { fixed overhead that would } & \
\quad \text { be allocated to asset if it were normal production } & 60,000 \
\text { Variable overhead attributable to self-construction } & 55,000
\end{array}$

What amount of overhead should be included in the cost of the self-constructed asset?

Quizplus · Accepted Answer

The Answer of During self-construction of an asset by Mitchellson Company, the following were among the costs incurred: $\begin{array}{lr}
\text { Fixed overhead for the year } & \$ 1,000,000 \
\text { Portion of } \$ 1,000,000 \text { fixed overhead that would } & \
\quad \text { be allocated to asset if it were normal production } & 60,000 \
\text { Variable overhead attributable to self-construction } & 55,000
\end{array}$

What amount of overhead should be included in the cost of the self-constructed asset?

During Self-Construction of an Asset by Mitchellson Company, the Following