10,000 units of inventory What happens over the long run? How might you mitigate the incentive to build up inventory?

10,000 units of inventory What happens over the long run? How might you mitigate the incentive to build up inventory? Lloyd"s Bicycles produces bicycle parts for domestic and foreign markets. Fixed overhead costs are $200,000 within the relevant range of the various capacity volume. Assume that the theoretical capacity is 10,000 machine-hours, practical capacity is 85%, normal capacity is 75%, and master-budget capacity is 60%. What is the budgeted fixed manufacturing overhead rate at the various capacity levels?