The following data relates to All-Out Company's estimated amounts for next year.
$\begin{array}{lcc}
\text { Estimated: } & \text { Department 1 } & \text { Department 2 } \
\text { Manufacturing overhead costs } & \$ 200,000 & \$ 400,000 \
\text { Direct labor hours } & 60,000 \mathrm{DLH} & 80,000 \mathrm{DLH} \
\text { Machine hours } & 1,000 \mathrm{MH} & 3,000 \mathrm{MH}
\end{array}$
What is the company's plantwide overhead rate if machine hours are the allocation base?
(Round to two decimal places.)

Question

The following data relates to All-Out Company's estimated amounts for next year. 
$\begin{array}{lcc}
\text { Estimated: } & \text { Department 1 } & \text { Department 2 } \
\text { Manufacturing overhead costs } & \$ 200,000 & \$ 400,000 \
\text { Direct labor hours } & 60,000 \mathrm{DLH} & 80,000 \mathrm{DLH} \
\text { Machine hours } & 1,000 \mathrm{MH} & 3,000 \mathrm{MH}
\end{array}$
What is the company's plantwide overhead rate if machine hours are the allocation base?
(Round to two decimal places.)

Quizplus · Accepted Answer

The total manufacturing overhead costs are $600,000 ($200,000 + $400,000). The total machine hours are 4,000 (1,000 + 3,000). The plantwide overhead rate is $600,000 / 4,000 MH = $150.00 per MH.

The Following Data Relates to All-Out Company's Estimated Amounts for Next