(Solved) Tiff Corporation has two production departments, Casting and Assembly. The company uses a job-order ...

Tiff Corporation has two production departments, Casting and Assembly. 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 Assembly 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	Assembly
Machine-hours	17,000	10,000
Direct labor-hours	1,000	5,000
Total fixed manufacturing overhead cost	$ 129,200	$ 46,500
Variable manufacturing overhead per machine-hour	$ 1.80
Variable manufacturing overhead per direct labor-hour		$ 3.80

During the current month the company started and finished Job P131. The following data were recorded for this job:

Job P131:	Casting	Assembly
Machine-hours	90	20
Direct labor-hours	20	60

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

▸ $9.40 per machine-hour

▸ $7.60 per machine-hour

▸ $1.80 per machine-hour

▸ $31.96 per machine-hour

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Tiff Corporation has two production departments, Casting and Assembly. The company uses a job-order ...

Introduction to Managerial Accounting: Brewer Edition: 9e

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