Fredin Incorporated Makes a Single Product-An Electrical Motor Used in Many

question 119

Multiple Choice

Fredin Incorporated makes a single product-an electrical motor used in many long-haul trucks. The company has a standard cost system in which it applies overhead to this product based on the standard labor-hours allowed for the actual output of the period. Data concerning the most recent year appear below: The variable component of the predetermined overhead rate is closest to:

• A) $2.68 per labor-hour
• B) $3.02 per labor-hour
• C) $2.93 per labor-hour
• D) $2.41 per labor-hour