Price Company Assigns Overhead Based on Machine Hours

question 126

Multiple Choice

Price Company assigns overhead based on machine hours. The Milling Department logs 2400 machine hours and Cutting Department shows 4000 machine hours for the period. If the overhead rate is $5 per machine hour the entry to assign overhead will show a

• A) debit to Manufacturing Overhead for $32000.
• B) credit to Work in Process-Cutting Department for $20000.
• C) debit to Work in Process for $20000.
• D) credit to Manufacturing Overhead for $32000.

---

Definitions:

Law Of Diminishing Marginal Returns

A principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase if other inputs remain constant.

Metamucil

Metamucil is a fiber supplement used to treat constipation and improve overall digestive health by adding bulk to the stool.

Vomiting

The forceful expulsion of stomach contents through the mouth.

First-Degree Burn

A mild burn affecting only the outer layer of the skin, causing redness, pain, and no blistering.