Felton Quality Productions uses a predetermined overhead allocation rate based on machine hours. It has provided the following information for the year 2014: Based on the above information, calculate the manufacturing overhead rate applied by Felton.

Question

Felton Quality Productions uses a predetermined overhead allocation rate based on machine hours. It has provided the following information for the year 2014:  Based on the above information, calculate the manufacturing overhead rate applied by Felton.

Quizplus · Accepted Answer

Manufacturing overhead rate = Estimated manufacturing overhead cost / Estimated machine hours
= $204,600 / 144,000 machine hours
= $1.42 per machine hour.

Felton Quality Productions Uses a Predetermined Overhead Allocation Rate Based