Aaron Company Estimates Direct Labor Costs and Manufacturing Overhead Costs

question 138

Multiple Choice

Aaron Company estimates direct labor costs and manufacturing overhead costs for the coming year to be $800,000 and $500,000, respectively. Aaron allocates overhead costs based on machine hours. The estimated total labor hours and machine hours for the coming year are 16,000 hours and 10,000 hours, respectively. What is the predetermined overhead allocation rate?

• A)$80.00 per machine hour
• B)$31.25 per labor hour
• C)$81.25 per labor hour
• D)$50.00 per machine hour

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Definitions:

SA Node

The sinoatrial node, a group of cells located in the right atrium of the heart that initiates the electrical impulses governing the heart rate, often considered the heart's natural pacemaker.

Depolarization

The process by which the resting potential of a cell membrane becomes less negative, leading to the initiation of an action potential.

Heart Rate

The number of heartbeats per unit of time, usually measured in beats per minute (bpm), indicating the heart's workload and overall cardiovascular health.

Plateau Phase

A phase in some action potentials, notably in cardiac muscle cells, characterized by sustained depolarization that prolongs the action potential.