Bob's Biscuit Corporation budgeted $1,200,000 of factory overhead cost for the coming year.Its plantwide allocation base,machine hours,is budgeted at 100,000 hours.Budgeted units to be produced are 200,000 units.Bob's plantwide factory overhead rate is $12.00 per machine hour.

Question

Quizplus · Accepted Answer

The plantwide factory overhead rate is calculated as follows:

Plantwide factory overhead rate = Budgeted factory overhead cost / Budgeted machine hours
Plantwide factory overhead rate = $1,200,000 / 100,000 machine hours
Plantwide factory overhead rate = $12.00 per machine hour

Therefore, option A is correct.

Bob's Biscuit Corporation Budgeted $1,200,000 of Factory Overhead Cost for the Coming