Question: 11. ACC Inc allocates indirect costs using a single cost pool to each unit of output it produces using machine hours. It uses a pre-determined

11. ACC Inc allocates indirect costs using a single cost pool to each unit of output it produces using machine hours. It uses a pre-determined allocation rate.

The information provided below relates to the period 1 Jan 2021 until 31 Dec 2021 for ACC.

Actual total indirect cost = $800,000

Budgeted total indirect cost = $600,000

Actual quantity of machine hours = 450,000 hours

Budgeted quantity of machine hours = 400,000 hours

The allocation rate that is used by ACC to allocate indirect costs to its units of output in 2021 is closest to:

Group of answer choices

0.67

1.78

1.33

0.55

1.50

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