Question

At the beginning of the year, Bonita Industries estimates annual overhead costs to be $2400000 and that 100000 machine hours will be operated. Using machine hours as a base, the amount of overhead applied during the year if actual machine hours for the year was 215000 hours is __________.

Answer 1

$5,160,000

Step-by-step explanation:

Annual overhead cost at $2,400,000 at 100,000 machine hours

using machine hours as the base, overhead cost per hour would be,

= 2,400,000/100,000

For 215,000 hours, the cost will be 2400000/100000 x 2150000

=24 x 215, 000

=$5,160,000