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If Megan intends to offer and believes she is offering for sale to Alexis her RL1500 space heater and Alexis reasonably believes Megan is offering her RL1900 heater and accepts on that belief, a contract has not been formed because there was no agreement as to the subject matter.
Predetermined Overhead Rate
An estimated rate used to allocate manufacturing overhead costs to individual products or job orders based on a selected activity base, like direct labor hours or machine hours.
Machine-Hours
A measure of the total time machines are operated within a production process, often used for allocating costs based on machine usage.
Fixed Manufacturing Overhead
Costs that do not change with the level of production, such as rent, salaries, and insurance, related to the production process.
Departmental Predetermined Rates
These are rates used to allocate indirect costs to various departments based on estimated overhead and expected activity.
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