Pinnacle Corp. budgeted $256,440 of overhead cost for the current year. Actual overhead costs for the year were $247,850. Pinnacle's plantwide allocation base, machine hours, was budgeted at 51,170 hours. Actual machine hours were 55,880. A total of 108,410 units was budgeted to be produced and 98,000 units were actually produced. Pinnacle's plantwide factory overhead rate for the current year is: Oa. $5.01 per machine hour Ob. $4.84 per machine hour Oc. $2.37 per machine hour Od. $2.29 per machine hour
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Question Content Area
Given the following information, determine the activity rate for setups.
| Activity | Total Activity-Base Usage | Budgeted Activity Cost |
| Setups | 10,100 | $63,200 |
| Inspections | 24,100 | $137,300 |
| Assembly (dlh) | 72,000 | $400,600 |
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