Brookstone Company produces 9 volt batteries and AAA batteries. Brookstone Company uses a plantwide rate to apply overhead based on direct labor hours. The following data are given: Actual overhead $325,000 Estimated overhead $350,000 Estimated activity: 9 volt battery 100,000 direct labor hours AAA battery 400,000 direct labor hours Actual activity:
Brookstone Company produces 9 volt batteries and AAA batteries. Brookstone Company uses a plantwide rate to apply overhead based on direct labor hours. The following data are given: Actual overhead $325,000 Estimated overhead $350,000 Estimated activity: 9 volt battery 100,000 direct labor hours AAA battery 400,000 direct labor hours Actual activity:
Chapter1: Financial Statements And Business Decisions
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Brookstone Company produces 9 volt batteries and AAA batteries. Brookstone Company uses a plantwide rate to apply overhead based on direct labor hours. The following data are given:
What is the predetermined overhead rate?
| Actual overhead | $325,000 |
| Estimated overhead | $350,000 |
| Estimated activity: | |
| 9 volt battery | 100,000 direct labor hours |
| AAA battery | 400,000 direct labor hours |
| Actual activity: | |
| 9 volt battery | 125,000 direct labor hours |
| AAA battery | 400,000 direct labor hours |
| Units produced: | |
| 9 volt battery | 500,000 |
| AAA battery | 250,000 |
What is the predetermined overhead rate?
a.$0.62
b.$0.67
c.$0.65
d.$0.70
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