Custom Engines Company has the following estimated costs for the upcoming year:
Direct labor costs $ 62,900
Direct materials used $ 25,900
Salary of factory supervisor $ 37,000
Sales commissions $ 8,800
Heating and lighting costs for factory $ 22,300
Depreciation on factory equipment $ 5,600
Advertising expense $ 33,400
The company estimates that 1,800 direct labor hours will be worked in the upcoming year, while 2,900 machine hours will be used during the year. The predetermined manufacturing overhead rate per machine hour is closest to:_________ (Round your final answer to the nearest whole dollar.)
A. $78
B. $42.
C. $24.
D. $26

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Respuesta :

andromache andromache · Answer 1 · 2020-07-23T02:20:09+02:00

Answer:

$22

Explanation:

The computation of the predetermined manufacturing overhead rate per hour is shown below:

= Total Factory overhead ÷ Estimated labor hours

where,

Total factory overhead is

= Salary of factory supervisor + Heating and lighting costs for factory + Depreciation on factory equipment

= $37,000 + $22,300 + $5,600

= $64,900

And, the machine hours is 2.900

So, the predetermined overhead rate is

= $64,900 ÷ 2,900

= $22

This is the answer but the same is not given in the options