If estimated production overhead in the printing department is $120,000 and actual overhead is $116,000 and estimated machine hours in the printing department are 30,000 hours and actual machine hours are 32,000 hours, using normal costing what is the overhead recovery rate for the printing department?

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Quizplus · Accepted Answer

The overhead recovery rate is calculated using estimated overhead costs divided by estimated machine hours: $120,000 / 30,000 hours = $4 per machine hour.

If Estimated Production Overhead in the Printing Department Is $120,000