The Predetermined Overhead Rate (Variable and Fixed) Is $7

question 35

Multiple Choice

The predetermined overhead rate (variable and fixed) is $7.50 per machine-hour and the denominator activity level is 135,000 machine-hours. If the variable portion of the predetermined overhead rate is $3.00 per machine-hour, then the budgeted fixed factory overhead for the year is:

• A) $30,000
• B) $607,500
• C) $405,000
• D) $1,012,500

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Definitions:

Marginal Revenue Product Schedule

A representation that shows how the additional revenue generated changes with the addition of one more unit of a resource.

Marginal Revenue Product Curve

A graphical representation that shows the additional revenue generated by employing one more unit of a resource, such as labor.

Marginal Revenue Product Curve

A graphical representation showing the additional revenue generated by employing one more unit of a resource.

Marginal Revenue Product

The additional revenue generated from employing one more unit of a resource, assuming all else constant.