The Roget Factory Has Determined That Its Budgeted Factory Overhead

question 28

Multiple Choice

The Roget Factory has determined that its budgeted factory overhead budget for the year is $15,500,000.They plan to produce 2,000,000 units.Budgeted direct labor hours are 1,050,000 and budgeted machine hours are 750,000.Using the single plantwide factory overhead rate based on direct labor hours,calculate the factory overhead rate for the year.

• A) $14.76
• B) $20.67
• C) $7.75
• D) $77.50

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Definitions:

Price Level

The price level is a measure of the average prices of goods and services in the economy at a given time.

Cost of Borrowing

The interest and any other charges incurred by borrowing money.

Open-Market Purchases

The buying of government bonds by a central bank to inject money into the economy and expand economic activity.

Investment

The allocation of resources, usually money, in the expectation of generating an income or profit.