1. A manufacturing company prepays its insurance coverage for a three-year period. The premium for the three years is $2,700 and is paid at the beginning of the first year. Eighty percent of the premium applies to manufacturing operations and 20% applies to selling and administrative activities. What amounts should be considered product and period costs respectively for the first year of coverage?

	Option A
	Option B
	Option C
	Option D

2. Hayne Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year. Data for the most recently completed year appear below: The predetermined overhead rate for the recently completed year was closest to:

	$7.89
	$30.95
	$24.52
	$32.41