Asked by Adriana Davis on May 02, 2024
Verified
Kesterson Corporation has provided the following information: If 4,000 units are produced, the total amount of manufacturing overhead cost is closest to:
A) $16,300
B) $25,600
C) $19,400
D) $13,200
Manufacturing Overhead Cost
Indirect costs related to manufacturing that cannot be traced directly to individual products, such as maintenance and factory manager salaries.
Produced Units
The total number of items manufactured by a company during a specific period.
- Learn the methodology for computing the aggregate manufacturing overhead costs.
Verified Answer
ZK
Zybrea KnightMay 05, 2024
Final Answer :
C
Explanation :
Using the given information:
Total variable manufacturing overhead cost = $31,200
Total fixed manufacturing overhead cost = $47,000
Total units produced = 8,000
Therefore, the predetermined overhead rate is:
Predetermined overhead rate = (Total variable manufacturing overhead cost + Total fixed manufacturing overhead cost) / Total units produced
= ($31,200 + $47,000) / 8,000
= $9.65 per unit
To find the total manufacturing overhead cost for 4,000 units produced:
Total manufacturing overhead cost = Predetermined overhead rate x Actual units produced
= $9.65 x 4,000
= $38,600
Therefore, the closest answer choice is (C) $19,400.
Total variable manufacturing overhead cost = $31,200
Total fixed manufacturing overhead cost = $47,000
Total units produced = 8,000
Therefore, the predetermined overhead rate is:
Predetermined overhead rate = (Total variable manufacturing overhead cost + Total fixed manufacturing overhead cost) / Total units produced
= ($31,200 + $47,000) / 8,000
= $9.65 per unit
To find the total manufacturing overhead cost for 4,000 units produced:
Total manufacturing overhead cost = Predetermined overhead rate x Actual units produced
= $9.65 x 4,000
= $38,600
Therefore, the closest answer choice is (C) $19,400.
Learning Objectives
- Learn the methodology for computing the aggregate manufacturing overhead costs.
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