Question

From the given statement choose the correct one :
over head rate =​

Answer 1

Answer:

Overhead rate= Indirect costs /allocation measure

Explanation:

Overhead rate is a cost allocated to the production of a product or service. Overhead costs are expenses that are not directly tied to production such as the cost of the corporate office.

By analyzing how much it costs in overhead for every hour the machine is producing the company's goods, management can properly price the product to make sure there's enough profit margin to compensate for its indirect costs.

A company that excels at monitoring and improving its overhead rate can improve its bottom line or profitability.