Question

Receiving provides 12,000 receiving hours and costs $60,000 per year. What is the activity rate for receiving?

a.$5 per receiving hour
b.$4.50 per receiving hour
c.$14 per receiving hour
d.$4 per receiving hour
e.Cannot be determined from this information.

Answer 1

The correct answer is A.

Step-by-step explanation:

Giving the following information:

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Receiving provides 12,000 receiving hours and costs $60,000 per year.

Estimated manufacturing overhead rate= 60,000/12,000= $5 per hour