Company expected to incur $9,450 in manufacturing overhead costs and use 4,500 machine hours for the year. Actual manufacturing overhead was $9,400 and the company used 5,050 machine hours. 1. Calculate the predetermined overhead allocation rate using machine hours as the allocation base.
/ = Predetermined overhead allocation rate
/ = per machine hour
2. How much manufacturing overhead was allocated during the? year?
x = overhead allocated
x =

1.Predetermined overhead allocation rate = $2.10 per Machine Hour

2.Overhead allocated = $10,605

Explanation:

1.   Predetermined overhead allocation rate

using

Estimated manufacturing overhead costs / Estimated Machine Hours = Predetermined overhead allocation rate

=$9,450 / 4,500 Machine Hours = $2.10 per machine hour

Therefore,

Predetermined overhead allocation rate = $2.10 per Machine Hour

2. Manufacturing overhead allocated during the year

Actual Machine Hours Used x Predetermined overhead allocation rate = Overhead allocated

5,050 machine hours x $2.10 per Machine Hour = $10,605

Therefore,

Overhead allocated = $10,605

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