Really Great Corporation manufactures industrial-sized landscaping trailers and uses budgeted machine-hours to allocate variable manufacturing overhead. The following information pertains to the company's manufacturing overhead data:

What is the budgeted variable overhead cost rate per output unit?

Question

Really Great Corporation manufactures industrial-sized landscaping trailers and uses budgeted machine-hours to allocate variable manufacturing overhead. The following information pertains to the company's manufacturing overhead data:

What is the budgeted variable overhead cost rate per output unit?

Quizplus · Accepted Answer

Machine hour per unit = 10,000 ÷ 40,000 = 0.25
Budgeted cost per machine hour = $310,000 ÷ 10,000 = $31.00
Budgeted cost per unit = $31.00 × 0.25 = $7.75

Really Great Corporation Manufactures Industrial-Sized Landscaping Trailers and Uses Budgeted