Answers.com > Wiki Answers > Categories > Business & Finance > How is predetermined overhead rates useful in costing?

How is predetermined overhead rates useful in costing?

Answer:

It allows you to forecast future costs needed to do business.

First answer by ID2793432441. Last edit by ID2793432441. Question popularity: 15 [recommend question].

Can you answer these Business & Finance questions?

	Can titles be centered across multiple cells?	Answer it!
	How long does an employer keep work schedules?	Answer it!
	What is the physical environment for a photographer?	Answer it!
	How does the Federal Deficit Financing influence monetary and credit conditions?	Answer it!
	Can you tell when a cash prize genuine?	Answer it!

How do you determine predetermined overhead rate?
A predetermined overhead rate (POHR) is a rate used to apply manufacturing overhead (MOH) to work in progress inventory. To compute the POHR some preliminary work is needed. First, a measure of...
When is the Predetermined overhead rate usually calculated?
The predetermined overhead rate used to apply overhead to finished jobs is determined before the period begins.
What is the advantage of using a predetermined overhead application rate?
Discuss why overhead costing methods using plant-wide overhead rate or departmental overhead rates?
ABC Costing. With advancing technology and intense competitions, companies will strive to provide wider varieties of goods and services. Companies will thus produce both simple and complex products....
Why overhead costing methods using plant-wide overhead rates or departmental overhead rates?
The main reason is over-reliance on volume as a basis for allocating overhead costs where products differ regarding the number of units produced, lot size, or complexity of production.