Rutherford Wheel and Axle, Incorporated, has an automated production process, and production activity is quantified in terms of machine hours. A standard-costing system is used. The annual static budget for 20x1 called for 6,000 units to be produced, requiring 30,000 machine hours. The standard overhead rate for the year was computed using this planned level of production. The 20x1 manufacturing cost report follows. RUTHERFORD WHEEL AND AXLE, INCORPORATED Manufacturing Cost Report For 20x1 (in thousands of dollars) Cost Item Static Budget Flexible Budget Actual Cost 30,000 Machine Hours 31,000 Machine Hours 32,000 Machine Hours Direct material: G27 aluminum $ 252.0 $ 260.4 $ 268.8 $ 270.0 M14 steel alloy 78.0 80.6 83.2 83.0 Direct labor: Assembler 273.0 282.1 291.2 287.0 Grinder 234.0 241.8 249.6 250.0 Production overhead: Maintenance 24.0 24.8 25.6 25.0 Supplies 129.0 133.3 137.6 130.0 Supervision 80.0 82.0 84.0 81.0 Inspection 144.0 147.0 150.0 147.0 Insurance 50.0 50.0 50.0 50.0 Depreciation 200.0 200.0 200.0 200.0 Total cost $ 1,464.0 $ 1,502.0 $ 1,540.0 $ 1,523.0 Rutherford develops flexible budgets for different levels of activity for use in evaluating performance. A total of 6,200 units was produced during 20x1, requiring 32,000 machine hours. The preceding manufacturing cost report compares the companys actual cost for the year with the static budget and the flexible budget for two different activity levels. 5. Compute the variable-overhead rate per machine hour in a flexible-budget formula. (Hint: Use the high low method to estimate cost behavior.)

Required information [The following information applies to the questions displayed below.] Rutherford Wheel and Axle, Incorporated, has an automated production process, and production activity is quantified in terms of machine hours. A standard-costing system is used. The annual static budget for 201 called for 6,000 units to be produced, requiring 30,000 machine hours. The standard overhead rate for the year was computed using this planned level of production. The 201 manufacturing cost report follows. Rutherford develops flexible budgets for different levels of activity for use in evaluating performance. A total of 6,200 units was produced during 201, requiring 32,000 machine hours. The preceding manufacturing cost report compares the company's actual cost for the year with the static budget and the flexible budget for two different activity levels. Compute the variable-overhead rate per machine hour in a flexible-budget formula. (Hint: Use the high low method to estimate cost ehavior.) Note: Round your answer to 2 decimal places. Required information [The following information applies to the questions displayed below.] Rutherford Wheel and Axle, Incorporated, has an automated production process, and production activity is quantified in terms of machine hours. A standard-costing system is used. The annual static budget for 201 called for 6,000 units to be produced, requiring 30,000 machine hours. The standard overhead rate for the year was computed using this planned level of production. The 201 manufacturing cost report follows. Rutherford develops flexible budgets for different levels of activity for use in evaluating performance. A total of 6,200 units was produced during 201, requiring 32,000 machine hours. The preceding manufacturing cost report compares the company's actual cost for the year with the static budget and the flexible budget for two different activity levels. Compute the variable-overhead rate per machine hour in a flexible-budget formula. (Hint: Use the high low method to estimate cost ehavior.) Note: Round your answer to 2 decimal places