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25 September, 05:07

Castleton Corporation manufactured 41,000 units during March. The following fixed overhead data relates to March: Production Machine-hours Fixed overhead costs for March Actual 41,000 units 6,020 hours $125,500 Static Budget 39,000 units 5,850 hours $117,000 What is the amount of fixed overhead allocated to production?

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  1. 25 September, 05:18
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    Allocated MOH = $120,400

    Explanation:

    Giving the following information:

    The following fixed overhead data relates to March:

    Actual 41,000 units 6,020 hours $125,500

    Static Budget 39,000 units 5,850 hours $117,000

    Estimated manufacturing overhead rate = total estimated overhead costs for the period / total amount of allocation base

    Estimated manufacturing overhead rate = 117,000 / 5850 = $20 per hour

    Allocated MOH = Estimated manufacturing overhead rate * Actual amount of allocation base

    Allocated MOH = 20 * 6,020 = $120,400
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