(Solved) Eisentrout Corporation has two production departments, Machining and Customizing. The company uses a ...

Eisentrout Corporation has two production departments, Machining and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Machining Department’s predetermined overhead rate is based on machine-hours and the Customizing 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:

	Machining	Customizing
Machine-hours	16,000	11,000
Direct labor-hours	2,000	6,000
Total fixed manufacturing overhead cost	$ 104,000	$ 56,400
Variable manufacturing overhead per machine-hour	$ 2.10
Variable manufacturing overhead per direct labor-hour		$ 3.30

During the current month the company started and finished Job T272. The following data were recorded for this job:

Job T272:	Machining	Customizing
Machine-hours	60	30
Direct labor-hours	10	60

The predetermined overhead rate for the Machining Department is closest to:

▸ $22.93 per machine-hour

▸ $6.50 per machine-hour

▸ $2.10 per machine-hour

▸ $8.60 per machine-hour

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Eisentrout Corporation has two production departments, Machining and Customizing. The company uses a ...

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