Aaron, Inc. estimates direct labor costs and manufacturing overhead costs for the coming year to be $780,000 and $540,000, respectively. Aaron allocates overhead costs based on machine hours. The estimated total labor hours and machine hours for the coming year are 17,000 hours and 6,000 hours, respectively. What is the predetermined overhead allocation rate? (Round your answer to the nearest cent.)

Aaron, Inc. estimates direct labor costs and manufacturing overhead costs for the coming year to be $780,000 and $540,000, respectively. Aaron allocates overhead costs based on machine hours. The estimated total labor hours and machine hours for the coming year are 17,000 hours and 6,000 hours, respectively. What is the predetermined overhead allocation rate? (Round your answer to the nearest cent.)

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter7: The Master Budget And Flexible Budgeting

Section: Chapter Questions

Problem 23Q: If a factory operates at 100% of capacity one month, 90% of capacity the next month, and 105% of...

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