Corrugated Company currently produces cardboard boxes in an automated process. Expected production per month is 50,000 units. The required direct materials cost is $0.30 per unit. Manufacturing fixed overhead costs are $24,000 per month. Manufacturing overhead is allocated based on units of production. is the budgeted manufacturing fixed overhead rate.
A) $0.48 per unit
B) $2.08 per unit
C) $0.30 per unit
D) None of these answers is correct.

Question

Quizplus · Accepted Answer

The budgeted manufacturing fixed overhead rate is calculated by dividing the total fixed overhead costs by the expected production units. $24,000 / 50,000 units = $0.48 per unit.

Corrugated Company Currently Produces Cardboard Boxes in an Automated Process