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

question 148

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 fixed component of the predetermined overhead rate is closest to:

• A) $16.73 per labor-hour
• B) $6.19 per labor-hour
• C) $8.36 per labor-hour
• D) $12.38 per labor-hour

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Definitions:

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