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psintusaichol psintusaichol
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A year ago

Petty Corporation has two production departments, Milling and Finishing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Milling 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:

MillingFinishing
Machine-hours20,00014,000
Direct labor-hours2,0008,000
Total fixed manufacturing overhead cost$ 148,000$ 88,000
Variable manufacturing overhead per machine-hour$ 1.90
Variable manufacturing overhead per direct labor-hour$ 3.60

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



▸ $5.84 per direct labor-hour

▸ $3.60 per direct labor-hour

▸ $11.00 per direct labor-hour

▸ $14.60 per direct labor-hour
Textbook 
Introduction to Managerial Accounting: Brewer Edition: 9e

Introduction to Managerial Accounting: Brewer Edition: 9e


Edition: 9th
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slmseuf1105slmseuf1105
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