The Manufacturing Overhead Budget at Waycaster Corporation Is Based on Budgeted

The manufacturing overhead budget at Waycaster Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 6,000 direct labor-hours will be required in February. The variable overhead rate is $3.40 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $81,600 per month, which includes depreciation of $18,000. All other fixed manufacturing overhead costs represent current cash flows.
-The company recomputes its predetermined overhead rate every month. The predetermined overhead rate for February should be:

A) $17.00
B) $13.60
C) $14.00
D) $3.40

Correct Answer:

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