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What is the plantwide predetermined overhead rate of Mickley Company?

1) 23.00 per direct labor-hour
2) 10.00 per hour
3) Cannot be determined
4) Not given in the information

User Icuken
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1 Answer

7 votes

Final answer:

An accurate plantwide predetermined overhead rate for Mickley Company cannot be determined without additional information on total estimated overhead costs and the allocation base.

Step-by-step explanation:

The question concerning the plantwide predetermined overhead rate of Mickley Company does not provide sufficient information to determine an accurate rate. A predetermined overhead rate is calculated by dividing the total estimated overhead costs for a period by the total estimated amount of the allocation base (e.g., direct labor hours, machine hours, or any other cost driver) for that same period. Unfortunately, the information provided in the tables and various parts of the question regarding marginal cost of labor and monopsonist's marginal cost of labor does not give us total overhead costs or an allocation base necessary to calculate the rate. Moreover, the option numbers given (1-4) seem unrelated to Mickley Company's specific circumstances without additional context.

User Chris Stewart
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