The predetermined overhead rate is closest to:

A) $8.30 per machine-hour
B) $11.40 per machine-hour
C) $5.20 per machine-hour
D) $3.10 per machine-hour

Predetermined Overhead Rate

This refers to the rate used to allocate manufacturing overhead costs to individual products or job orders, calculated before the accounting period begins based on estimated costs and activity levels.

Machine-hour

A measure of the amount of time a machine is operated, used in calculating manufacturing costs and setting production schedules.