Thomlin Company Forecasts That Total Overhead for the Current Year

question 178

Multiple Choice

Thomlin Company forecasts that total overhead for the current year will be $15,500,000 with 250,000 total machine hours. Year to date, the actual overhead is $16,000,000, and the actual machine hours are 330,000 hours. The predetermined overhead rate based on machine hours is

• A) $48 per machine hour
• B) $62 per machine hour
• C) $45 per machine hour
• D) $50 per machine hour

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Definitions:

Outstanding Deposits

Money that has been deposited into a bank account but has not yet been processed or credited to the account.

Outstanding Check

One that has been written but hasn’t yet cleared the bank and been charged to the customer’s account.

Adjusted Cash Balance

An amount reflecting the true cash balance after accounting for outstanding checks or deposits in transit.

Check Register

A check register is a record book used to track checks written, deposits made, and the current balance of a checking account.