Treasurers,Inc.,a manufacturer of gift articles,uses a single plantwide rate to allocate indirect costs with machine hours as the allocation base.Estimated overhead costs for the year are $6,000,000.Estimated machine hours are 29,000.During the year,the actual machine hours used were 50,000.Calculate the predetermined overhead allocation rate.(Round your answer to the nearest dollar.)

Question

Quizplus · Accepted Answer

Predetermined overhead allocation rate = Estimated overhead costs for the year ÷ Estimated machine hours

Predetermined overhead allocation rate = $6,000,000 ÷ 29,000 hours ≈ $207 per machine hour

Therefore, the best choice is C.