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Fact Pattern: The Mulvey Company derived the following cost relationship from a regression analysis of its monthly manufacturing overhead cost. C=$80,000+$12M If: C= monthly manufacturing
Fact Pattern: The Mulvey Company derived the following cost relationship from a regression analysis of its monthly manufacturing overhead cost. C=$80,000+$12M If: C= monthly manufacturing overhead cost M= machine hours The standard error of the estimate of the regression is $6,000. The standard time required to manufacture one six-unit case of Mulvey's single product is 4 machine hours. Mulvey applies manufacturing overhead to production on the basis of machine hours, and its normal annual production is 50,000 cases. Mulvey's predetermined fixed manufacturing overhead rate would be A. $4,00 per machine hour. B. $1.60 per machine hour. C. $4.80 per machine hour. D. $1.20 per machine hour
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