Question
The following cost data pertains to GHI Inc. for December 31 st , 2019: Beginning Work-in-Process:$10,000Ending Work-in-Process:$ 5,000Direct Materials Used:$20,000Direct Costs Incurred in Production:$30,000Actual Indirect
The following cost data pertains to GHI Inc. for December 31st, 2019:
Beginning Work-in-Process:$10,000Ending Work-in-Process:$ 5,000Direct Materials Used:$20,000Direct Costs Incurred in Production:$30,000Actual Indirect costs incurred in Production:$38,000
($20,000 of which is fixed)Beginning Finished Goods Inventories:$40,000Ending Finished Goods Inventories:$20,000
Budgeted Fixed Factory Overhead was $25,000 based on an expected activity level of 5,000 hours. During the period, GHI employees worked a total of 8,000 direct labour hours. GHI uses a job-order costing system and applies overhead costs using direct labour hours. What was GHI's actual fixed overhead rate?
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