Caple Corporation Applies Manufacturing Overhead on the Basis of Machine-Hours

question 233

Multiple Choice

Caple Corporation applies manufacturing overhead on the basis of machine-hours. At the beginning of the most recent year, the company based its predetermined overhead rate on total estimated overhead of $16,660. Actual manufacturing overhead for the year amounted to $25,000 and actual machine-hours were 1,460. The company's predetermined overhead rate for the year was $11.90 per machine-hour.
-The predetermined overhead rate was based on how many estimated machine-hours?

• A) 1,400
• B) 2,101
• C) 2,742
• D) 1,460

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Definitions:

Correlation Coefficient

A statistical measure that calculates the extent to which two variables fluctuate together, indicating the strength and direction of their relationship.

Degree of Relationship

A measure of kinship calculated by the number of steps from one family member to another through common ancestors.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, indicating how much the individual values in a data set differ from the mean.

Positively Correlated

A statistical relationship where two variables move in the same direction; as one increases, the other tends to increase as well.