Explain the computation of machine hour rate with the help of an example.

The computation of machine hour rate is essential in cost accounting to determine the cost incurred for using a machine per hour. This rate helps in allocating the cost of machine usage to products, jobs, or processes based on the time the machine is utilized. The machine hour rate is primarily calculated by considering both the fixed and variable costs associated with the machine’s operation.

Steps for Calculating Machine Hour Rate:

1. Identify the Total Fixed Costs: Fixed costs are those that do not change with ______ ______ __________ _________ ____ _______ _________ __________ _____.
   ____ ____ ___ __________ _________ ___ _____ ________.
   _________ ______ ________ ___ ____ _____ _________ __________ __________ ___ ____.
   _________ ___ _______ ___ __________ ______ _____ _______ ______.
   ___ ____ ________ ________ _____ ____ __________ _____ __________ _________.
   _____ ________ __________ _________ __________ ____ ______ _______ ___ ____ _______ __________.
   ____ ________ ________ ________ ______ __________.
   ________ ___ _________ _________ ______ ________ _____.
   ________ __________ _____ _______ __________ _______ _______ ________ _________ _______ ___ _______.
   __________ __________ __________ ____ ________ ________ _____ __________ ____ ____.
   _________ ________ ______ _________ ________ ___ ____ ___.
   _______ __________ ___ _______ ____ ______ ___ _________ _________ ____.
   __________ _________ __________ __________ _______ _____ _____ ________.
   ________ ________ _____ ______ _________ __________ _________ _________ ________.
   ___ ________ ________ _____ __________.
   ________ _____ _______ ___ _________ _____ ______ ______ ________ ___.
   __________ _____ _________ ____ ______ ________ ___ ____ ____ _____ _____.
   _____ ___ _____ ___ ___.
   ________ __________ ____ _________ ___ _________ __________.
   __________ _______ _____ ________ ___ ______ _______.
   ________ __________ ______ ___ __________ _________ _____ ____ ____ _______ ______ _____.
   __________ ______ ________ ___ ___.
   _____ ____ _________ _________ ____ ______ __________ ___.
   ___ ____ ________ __________ ________ _________ ________ ________ ___ _______ ________.
   _________ __________ _____ _______ ______ __________ __________ ___.
   ___ _____ __________ _______ ___ ______.
   ___ ____ ________ ____ __________ _________ ______ _______ ____.
   ______ _______ ________ ________ _______ ________ ____.
   __________ ___ _______ ______ ________ _________ _______ ______ ___ __________.
   _________ __________ ___ _____ __________ ________ ______ __________ ________ ________ _________.
   _________ __________ _____ _____ ___.
   ___ ________ ____ __________ __________ __________.
   _____ ___ _____ ___ __________ _________ ______.
   _________ _________ __________ _______ __________ _________ _____.
   ____ ___ ____ _________ _____.
   _______ ____ _______ _____ ___ ____ __________ __________.
   ___ _______ _______ _____ ___ _______ ___ _______ _______ __________ _______.
   ______ ____ _____ _________ _________ ________ ________ __________.
   ___ __________ ___ ____ ____ _______.
   ______ ____ _______ ___ _______ ________ ___ __________ ____ _______ ____ _____.
   __________ _____ ________ __________ __________ _______ _______ ___ ________ _________ ____ _____.
   ___ _____ __________ _____ _____ ____ __________ ___.
   ________ _____ ____ ______ _____ _______ __________ _____.
   __________ ________ _____ _______ ___ _______ ______ ________ ________ _______ _____ __________.
   _______ _______ ________ ______ ______.
   ______ _________ _________ ______ __________ ________ __________ ______.
   ______ __________ ____ __________ _________ ______ _______.
   _____ ____ ____ ________ __________.
   __________ _____ ____ _______ _________ ____ _______ __________ ___ _____ __________.
   _______ _____ ___ ____ __________ ________ _____ _____ _________ ________ ___ ______.
   ____ _________ ____ ______ ____ ________.
   _____ _________ _____ ________ ____.
   Get Full Answer on WhatsApp