Yellow Company uses a plantwide overhead rate with machine hours as the allocati
ID: 2389672 • Letter: Y
Question
Yellow Company uses a plantwide overhead rate with machine hours as the allocation base. Use the following information to solve for the amount of machine hours estimated per unit of product RST.Direct material cost per unit of RST $12
Total estimated manufacturing overhead $200,000
Total cost per unit of RST $75
Total estimated machine hours 100,000
Direct labor cost per unit of RST $23
40 MH per unit of RST.
2 MH per unit of RST.
20 MH per unit of RST.
37.5 MH per unit of RST.
80 MH per unit of RST.
Explanation / Answer
total cost per unit=75
manufacturing overhead cost per unit=75-12-23=40 per unit
units produced=200000/40=5000 units
total machine hours=100000
machine hours per unit=100000/5000=20 machine hours per unit
40 MH per unit of RST.
2 MH per unit of RST.
20 MH per unit of RST.
37.5 MH per unit of RST.
80 MH per unit of RST.
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