Question
Exercise 10A-2 Predetermined Overhead Rate; Overhead Variances [LO10-3, LO10-4] Norwall Company's variable manufacturing overhead should be $1.55 per standard machine-hour and its fixed manufacturing overhead
Exercise 10A-2 Predetermined Overhead Rate; Overhead Variances [LO10-3, LO10-4]
Norwall Company's variable manufacturing overhead should be $1.55 per standard machine-hour and its fixed manufacturing overhead should be $73,938 per month. |
The following information is available for a recent month: |
a. | The denominator activity of 22,750 machine-hours is used to compute the predetermined overhead rate. |
b. | At the 22,750 standard machine-hours level of activity, the company should produce 9,100 units of product. |
c. | The companys actual operating results were: |
Number of units produced | 9,990 | |
Actual machine-hours | 24,190 | |
Actual variable manufacturing overhead cost | $ | 41,123 |
Actual fixed manufacturing overhead cost | $ | 72,700 |
Required: |
1. | Compute the predetermined overhead rate and break it down into variable and fixed cost elements. (Round your answers to 2 decimal places.) Predetermined overhead rate: Vairiable Elecment: Fixed element:
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