The Advantages of Machine Hour Rate in Cost Accounting.
- It helps to compare the effective deficiencies and cost off operating different machines.
image source: 2012books.lardbucket.org/books/accounting-for-managers/section_14/c25d6da50580563447ff2c5919b894f0.jpg
- It brings light to the existence of idle time of machine.
- It is most scientific practical and accurate method of recovery of manufacturing overheads.
- It provides useful data for estimating cost of production setting of standards and for fixing selling prices for quotations.
- It enables management to decide how far the machine work is preferable over manual work.