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Vektek Inc.thinks machine hours is the best activity base for its manufacturing overhead.The estimate of annual overhead costs for its jobs was $2050000.The company used 1000 hours of processing on Job No.B12 during the period and incurred overhead costs totaling $2100000.The estimated machine hours for the year totaled 20000.How much overhead should be applied to Job No.B12?
Margin of Safety
The difference between actual or expected sales and sales at the break-even point. It measures how close a company is to not covering its fixed costs.
Break-even Sales
The amount of revenue from sales that exactly covers the fixed and variable costs of producing and selling a product, with no profit or loss.
Pretax Net Income
The amount of money a company has earned before taxes are deducted.
Fixed Costs
Expenses that do not fluctuate with the volume of production or sales, such as rent, salaries, and insurance.
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