Columbia Manufacturing calculates its plantwide predetermined overhead rate annually based on machine hours. At the beginning of the year, it was estimated that 25,000 machine hours would be required for the estimated level of production. The company also estimated $375,000 of fixed manufacturing overhead cost for the period and variable manufacturing overhead of $4.00 per machine hour. The actual manufacturing overhead cost for the year was $465,000, and the actual total machine hours were 26,200. Compute the company's plantwide predetermined overhead rate for the year.

Columbia Manufacturing calculates its plantwide predetermined overhead rate annually based on machine hours. At the beginning of the year, it was estimated that 25,000 machine hours would be required for the estimated level of production. The company also estimated $375,000 of fixed manufacturing overhead cost for the period and variable manufacturing overhead of $4.00 per machine hour. The actual manufacturing overhead cost for the year was $465,000, and the actual total machine hours were 26,200. Compute the company's plantwide predetermined overhead rate for 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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