At the beginning of a year a company predicts total direct materials costs of $1,010,000 and total overhead costs of $1, 270,000. If the company uses direct materials costs as its activity base to allocate overhead, what is the predetermined overhead rate it should use during the year?

At the beginning of a year a company predicts total direct materials costs of $1,010,000 and total overhead costs of $1, 270,000. If the company uses direct materials costs as its activity base to allocate overhead, what is the predetermined overhead rate it should use during the year?

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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Question

I want to correct answer general accounting

At the beginning of a year a company predicts total direct
materials costs of $1,010,000 and total overhead costs of $1,
270,000. If the company uses direct materials costs as its activity
base to allocate overhead, what is the predetermined overhead
rate it should use during the year?

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