The Capacity for a Machine or System That Is Available

question 62

Multiple Choice

The capacity for a machine or system that is available after accounting for scrap and rework is known as

• A)design capacity.
• B)available capacity.
• C)actual capacity.
• D)rough capacity.

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Definitions:

Variable Manufacturing Overhead

Expenses related to manufacturing that fluctuate with production volume, including costs for supplies and variable labor.

Machine-Hours

A measure of production time using machinery, often used to allocate manufacturing overhead based on the time machines are used in the production process.

Predetermined Overhead Rate

A calculated rate used to assign overhead costs to products or services, based on estimated or budgeted overhead expenses and activity.

Unit Product Costs

The calculated cost to produce one unit of product, including direct materials, labor, and overhead.