At the beginning of a year, Mountain Manufacturing predicts total direct materials costs of $850,000 and total overhead costs of $935,000. 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, Mountain Manufacturing predicts total direct materials costs of $850,000 and total overhead costs of $935,000. 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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Kindly help me Accounting question

At the beginning of a year, Mountain Manufacturing
predicts total direct materials costs of $850,000 and
total overhead costs of $935,000. 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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