he Thomlin Company forecasts that total overhead for the current year will be $11,385,000 with 164,000 total machine hours. Year to date, the actual overhead is $7,616,000 and the actual machine hours are 93,000 hours. If the Thomlin Company uses a predetermined overhead rate based on machine hours for applying overhead, as of this point in time (year to date), the overhead is Round the factory overhead rate to the nearest dollar before multiplying by the number of hours.
he Thomlin Company forecasts that total overhead for the current year will be $11,385,000 with 164,000 total machine hours. Year to date, the actual overhead is $7,616,000 and the actual machine hours are 93,000 hours. If the Thomlin Company uses a predetermined overhead rate based on machine hours for applying overhead, as of this point in time (year to date), the overhead is Round the factory overhead rate to the nearest dollar before multiplying by the number of hours.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
he Thomlin Company
Round the factory overhead rate to the nearest dollar before multiplying by the number of hours.
Expert Solution
Step 1
Formula:
Predetermined overhead rate = Estimated overheads / Estimated labor hours
Division of estimated overheads with estimated labor hours derives the Predetermined overhead rate.
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