The total annual cash inflow from (his machine for capital budgeting purposes is

Question

The total annual cash inflow from (his machine for capital budgeting purposes is: A. dollar 3.650 B. dollar 5,150 C. dollar 4,750 D. dollar 5,000 A radial tire manufacturer produces products in two departments-Divisions A and B. The company uses separate predetermined overhead allocation rates for each department to allocate its overhead. Divisions A and B have estimated manufacturing overhead costs of dollar 170,000 and dollar 550,000, respectively. Division A uses machine hours as the allocation base, and Division B uses direct labor hours as the allocation base. The total estimated machine hours were 34,000, and direct labor hours were 20,000 for the year. Calculate the departmental predetermined overhead allocation rates. (Round your answer to the nearest cent.) A) Division A-dollar 5.00, Division B-dollar 17.50 B) Division A- dollar 17.50, Division B-dollar 5.00 C) Division A-dollar 8.50, Division B-dollar 10.29 D) Division A-dollar 10.29, Division B-dollar 8.50

Explanation / Answer

Question 21 has only question is given, there is no other information. how to calculate.

22. answer a. Division A - $5.00 , Division B - $17.50

Predetermined overhead rate = Estimated manufacturing overhead / direct labor hours as the allocation base

Division A = 170000 / 34000 = 5.00

Division B = 350000 / 20000 = 17.50.

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