Tungsten,Inc Calculate the Predetermined Overhead Allocation Rate

question 144

Multiple Choice

Tungsten,Inc.manufactures both normal and premium tube lights.The company allocates manufacturing overhead using a single plantwide rate with machine hours as the allocation base.Estimated overhead costs for the year are $102,000.Additional estimated information is given below. $$\begin{array} { | l | r | r | } \hline & \text { Normal } & \text { Premium } \\\hline \text { Machine hours } ( \mathrm { MHr } ) & 24,000 & 39,000 \\\hline \text { Direct materials } & \$ 51,000 & \$ 480,000 \\\hline\end{array}$$ Calculate the predetermined overhead allocation rate.(Round your answer to the nearest cent.)

• A)$4.25 per direct labor hour
• B)$1.62 per machine hour
• C)$2.62 per machine hour
• D)$0.19 per direct labor hour

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