Anton Believes His Company's Overhead Costs Are Driven (Affected)by the Number

question 70

Multiple Choice

Anton believes his company's overhead costs are driven (affected) by the number of machine hours because the production process is heavily automated.During the period,the company produced 3,000 units of Product A requiring a total of 100 machine hours and 2,000 units of Product B requiring a total of 25 machine hours.What allocation rate should be used if the company incurs overhead costs of $10,000?

• A) $2 per unit
• B) $2 per machine hour
• C) $80 per unit
• D) $80 per machine hour

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