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Twinkle Ornaments Company uses job costing. Twinkle Ornaments Company has two departments, Trimming

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Twinkle Ornaments Company uses job costing. Twinkle Ornaments Company has two departments, Trimming

Twinkle Ornaments Company uses job costing. Twinkle Ornaments Company has two departments, Trimming and Finishing. Manufacturing overhead is allocated based on direct labor cost in the Trimming Department and direct labor hours in the Finishing Department. The following additional information is available:

Estimated amounts   Trimming Dept   Finishing Dept
Direct labor cost    $320,000     $400,000
Direct labor hours    25,000     40,000
Manufacturing overhead costs    $400,000     $300,000

Actual data for completed Job No. 650 is as follows:

Actual amounts   Trimming Dept   Finishing Dept
Direct materials requisitioned    $22,500     $52,500
Direct labor cost    $35,400     $37,100
Direct labor hours    5,400     5,000

What is the predetermined manufacturing overhead rate for the Trimming Department?
A) 80% of direct labor cost
B) 103% of direct labor cost
C) 100% of direct labor cost
D) 125% of direct labor cost

Textbook

Managerial Accounting

Edition: 4^th

Author: Braun

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