The Chase Company uses a standard cost system in which manufacturing overhead costs are applied to products on the basis of standard machine-hours. For November, the company's flexible budget for manufacturing overhead showed the following total budgeted costs at the denominator activity level of 40,000 machine-hours:
During November 42,000 machine-hours were used to complete 13,200 units of product with the following actual overhead costs:
The standard time allowed to complete one unit of product is 3.6 machine-hours.
-The total predetermined overhead rate per machine-hour for November was:
Definitions:
Estimated Regression Line
A line calculated from the data that best fits the relationship between the independent variable(s) and the dependent variable, used to predict the value of the dependent variable from the independent variable(s).
Slope
The steepness of a line on a graph, representing the rate of change, calculated as the rise divided by the run between two points on the line.
Intercept
The value of the dependent variable when all independent variables in a model are set to zero.
Independent Variable
A variable that is manipulated or changed in an experiment to test its effects on a dependent variable.
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