Bernson Corporation is using a predetermined overhead rate that was based on estimated total fixed manufacturing overhead of $492,000 and 30,000 machine-hours for the period. The company incurred actual total fixed manufacturing overhead of $517,000 and 28,300 total machine-hours during the period. The amount of manufacturing overhead that would have been applied to all jobs during the period is closest to:

(A) $25,000

(B) $487,703

(C) $464,120

(D) $492,000

Question

Katelyn Harmon

Business

21 January, 19:26

Bernson Corporation is using a predetermined overhead rate that was based on estimated total fixed manufacturing overhead of $492,000 and 30,000 machine-hours for the period. The company incurred actual total fixed manufacturing overhead of $517,000 and 28,300 total machine-hours during the period. The amount of manufacturing overhead that would have been applied to all jobs during the period is closest to:

(A) $25,000

(B) $487,703

(C) $464,120

(D) $492,000

+1

Answers (1)

Know the Answer?

Makai King · Answer 1

(C) $464,120

Explanation:

The computation is shown below:

First, Calculate the predetermined overhead rate per hour which equals to

= (Estimated Overhead cost : estimated machine hours)

= ($492,000 : 30,000 hours)

= $16.4 per hour

So, the applied overhead equals to

= Predetermined overhead rate per hour * actual machine hours

= $16.4 per hour * 28,300 hours

= $464,120