The Management of Keeter Corporation Would Like to Investigate the Possibility

question 16

Multiple Choice

The management of Keeter Corporation would like to investigate the possibility of basing its predetermined overhead rate on activity at capacity. The company's controller has provided an example to illustrate how this new system would work. In this example, the allocation base is machine-hours and the estimated amount of the allocation base for the upcoming year is 89,000 machine-hours. In addition, capacity is 96,000 machine-hours and the actual level of activity for the year is 88,600 machine-hours. All of the manufacturing overhead is fixed and is $7,176,960 per year. For simplicity, it is assumed that this is the estimated manufacturing overhead for the year as well as the manufacturing overhead at capacity. It is further assumed that this is also the actual amount of manufacturing overhead for the year.
-If the company bases its predetermined overhead rate on capacity,the predetermined overhead rate is closest to:

• A)$74.76
• B)$81.00
• C)$80.64
• D)$79.66

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Definitions:

Anxiety

A feeling of worry, nervousness, or unease about something with an uncertain outcome.

Maladaptive Unconscious Conflict

Involves unresolved, unconscious conflicts that lead to behaviors which are not beneficial, often impacting mental health negatively.

Learning and Conditioning

The process by which behaviors are acquired or modified as a result of interaction with the environment, often discussed in the context of classical and operant conditioning.

Social Anxiety

The fear of social situations that involve interaction with other people, leading to feelings of self-consciousness and judgment.