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Ignatenko Company manufactures a line of lightweight running shoes. CEO Alona Ignatenko estimated ...

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Ignatenko Company manufactures a line of lightweight running shoes. CEO Alona Ignatenko estimated ...

Ignatenko Company manufactures a line of lightweight running shoes. CEO Alona Ignatenko estimated that the company would incur $2,400,000 in manufacturing overhead during the coming year. Additionally, she estimated the company would operate at a level requiring 200,000 direct labor hours and 500,000 machine hours.

Required:

a. Assume that Ignatenko Company uses direct labor hours as its manufacturing overhead
application base. Calculate the company's predetermined overhead rate.
b. Assume that job 3574 required 250 direct labor hours to complete. How much
manufacturing overhead should be applied to the job?
c. Assume that Ignatenko Company used machine hours as its manufacturing overhead
application base. Calculate the company's predetermined overhead rate.
d. Assume that job 3574 required 600 machine hours to complete. How much
manufacturing overhead should be applied to the job?

Textbook

Managerial Accounting

Edition: 4^th

Author: Davis

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