FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Zoom Tech Moldings allocates manufacturing overhead to jobs based on machine hours. The company has estimated
costs for the upcoming year as shown in the table.
Direct materials used
Direct labour costs
Salary of factory supervisor
Advertising expense
Heating and lighting costs for factory
Depreciation on factory equipment
Sales commissions
$25,000
$62,000
$41,000
$33,000
$21,000
$9,000
$8,000
The company estimates that 1800 direct labour hours will be worked in the upcoming year, and 2000 machine hours will
be used during the year.
What is the predetermined indirect allocation rate per machine hour? Round to the nearest dollar.
A.
$36
B.
$56
C.
$100
D.
$15
E.
$40
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Transcribed Image Text:Zoom Tech Moldings allocates manufacturing overhead to jobs based on machine hours. The company has estimated costs for the upcoming year as shown in the table. Direct materials used Direct labour costs Salary of factory supervisor Advertising expense Heating and lighting costs for factory Depreciation on factory equipment Sales commissions $25,000 $62,000 $41,000 $33,000 $21,000 $9,000 $8,000 The company estimates that 1800 direct labour hours will be worked in the upcoming year, and 2000 machine hours will be used during the year. What is the predetermined indirect allocation rate per machine hour? Round to the nearest dollar. A. $36 B. $56 C. $100 D. $15 E. $40
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