rdan Corporation expects to incur indirect overhead costs of $172,550 per month and direct manufacturing costs of $18 per unit. The expected production activity for the first four months of the year are as follows. January February March April Estimated production in units 5,300 7,300 4,800 6,400 Required Calculate a predetermined overhead rate based on the number of units of product expected to be made during the first four months of the year. Allocate overhead costs to each month using the overhead rate computed in Requirement a. Calculate the total cost per unit for each month using the overhead allocated in Requirement b.

Results are below.

Explanation:

Giving the following information:

Total estimated overhead costs= (172,550*4)= $690,200

Total estimated units= 23,800

To calculate the predetermined manufacturing overhead rate we need to use the following formula:

Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Predetermined manufacturing overhead rate= 690,200 / 23,800

Predetermined manufacturing overhead rate= $29 per unit

Now, we can allocate overhead to each month:

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

January= 29*5,300= $153,700

February= 7,300*29= $211,700

March= 29*4,800= $139,200

April= 29*6,400= $185,600

Finally, the unitary total cost:

Unitary cost= 18 + 29= $47

answerthe above statement is false;