Use the following information to answer the five questions in the quiz: The esti

Question

Use the following information to answer the five questions in the quiz: The estimated total factory overhead cost and total machine hours for Department 40 for the current year are $250,000 and 56,250 respectively. During January, the first month of the current year, actual machine hours used totaled 5,100 and factory overhead cost incurred totaled $22,000.

Determine the factory overhead rate based on machine hours:
$4.44 per machine hour
$2.25 per machine hour
$4.31 per machine hour
$4.76 per machine hour

Explanation / Answer

(a) $250,000/56,250 = $4.44 per machine hour

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