Biology Forums - Study Force

Marciante Corporation has two production departments, Casting and Finishing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Casting Department’s predetermined overhead rate is based on machine-hours and the Finishing Department’s predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates:

	Casting	Finishing
Machine-hours	17,000	10,000
Direct labor-hours	2,000	5,000
Total fixed manufacturing overhead cost	$ 105,400	$ 52,000
Variable manufacturing overhead per machine-hour	$ 1.70
Variable manufacturing overhead per direct labor-hour		$ 3.90

The estimated total manufacturing overhead for the Casting Department is closest to:

▸ $387,260

▸ $134,300

▸ $28,900

▸ $105,400

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