Chapter 16, Problem 1CMA

Baldwin Printing Company uses a job order cost system and applies overhead based on machine hours. A total of 150,000 machine hours have been budgeted for the year. During the year, an order for 1,000 units was completed and incurred the following:

The accountant computed the inventory cost of this order to be $4.30 per unit. The annual budgeted overhead in dollars was:

1. a. $577,500.
2. b. $600,000.
3. c. $645,000.
4. d. $660,000.