Question

Acitelli Corporation, which applies manufacturing overhead on the basis of machine-hours, has provided the following data for its most recent year of operations. Estimated manufacturing overhead $ 392,840 Estimated machine-hours 9,200 Actual manufacturing overhead $ 393,840 Actual machine-hours 9,260 The estimates of the manufacturing overhead and of machine-hours were made at the beginning of the year for the purpose of computing the company's predetermined overhead rate for the year. The applied manufacturing overhead for the year is closest to:

Answer 1

Answer:

$395,401

Explanation:

Given the above information, first we will determine the predetermined overhead rate.

Predetermined overhead rate = Estimated manufacturing overhead ÷ Estimated machine hours

Predetermined overhead rate= $392,840 ÷ 9,200

Predetermined overhead = $42.7

Now, the applied manufacturing overhead for the year is computed as;

= Actual machine hours × predetermined overhead rate

= 9,260 × $42.7

= $395,402