Bakos Corporation Bases Its Predetermined Overhead Rate on Variable Manufacturing

question 42

Multiple Choice

Bakos Corporation bases its predetermined overhead rate on variable manufacturing overhead cost of $8.80 per machine-hour and fixed manufacturing overhead cost of $100,688 per period. If the denominator level of activity is 2,800 machine-hours, the variable component in the predetermined overhead rate would be:

• A)$44.76
• B)$35.96
• C)$43.52
• D)$8.80

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Definitions:

Cash Receipts Journal

A financial journal used to record all cash inflows, tracking receipts from sales, loans, investments, and other sources.

Revenue Journal

A specialized accounting journal used to record the company's revenue transactions, distinguishing them from other types of financial transactions.

Accounts Payable Subsidiary Ledger

The subsidiary ledger containing the individual accounts with creditors (suppliers).

Cash Payments Journal

A business ledger that documents every cash expenditure or payment conducted by a company.