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Passa Caglia Passa Caglia
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2 months ago

Vanliere Corporation has two production departments, Machining and Finishing. 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 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:

MachiningFinishing
Machine-hours19,00011,000
Direct labor-hours3,0006,000
Total fixed manufacturing overhead cost$ 138,700$ 52,800
Variable manufacturing overhead per machine-hour$ 1.90
Variable manufacturing overhead per direct labor-hour$ 3.80

During the current month the company started and finished Job A803. The following data were recorded for this job:

Job A803:MachiningFinishing
Machine-hours9020
Direct labor-hours2060

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



▸ $8.80 per direct labor-hour

▸ $3.98 per direct labor-hour

▸ $12.60 per direct labor-hour

▸ $3.80 per direct labor-hour
Textbook 

Introduction to Managerial Accounting: Brewer Edition: 9e


Edition: 9th
Authors:
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pipi123pipi123
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2 months ago
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$12.60 per direct labor-hour

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Passa Caglia Author
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2 months ago
Good timing, thanks!
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this is exactly what I needed
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Correct Slight Smile TY
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