AMR Corp. currently uses a firm-wide overhead application based on expected direct labor hours.The following information is anticipated at the beginning of the year.

Department ADepartment B

Direct materialsP25.00/1b.P17.00/1b.

Direct labor hours10,0005,000

Machine hours2,00010,000

OverheadP115, 000P85, 000

Labor rateP 15.00/hrP 12.00/hr

1.If the firm maintains the current method, the overhead application rate is:

a.P 7.67/hr

b.P11.50/hr

c.P13.33/hr

d.P20.00/hr

2.If departmental rates were adopted,what would be the rates for Departments A

(Based on direct labors hours) and B (based on machine hours)

AB

a.P11.50P 8.50

b.P11.15P17.00

c.P57.50P 8.50

d.P57.50P17.50

Sensual Scents, Inc. uses job-order cost system with machine hours as the overhead base. At the beginning of last year, Sensual estimated 38,000 machine hours were logged but P153, 500 of overhead cost was incurred.

3.What is sensual' under-or overapplied manufacturing overhead?

a.P 1,500 underapplied

b.P1,500 overapplied

c.P2,000 underappld

d.P3,500 underapplied

The following information relates to Donna Corporation for the last year. Donna uses direct labor hours as anoverhead base.

Estimated direc labor hours 136,000 hours

Estimated manufacturing overhead costsP 108,800

Actual manufacturing overhead costs108,480

Applied manufacturing overhead costs110,000

4.What was the actual number of direct labor hours worked last year at Donna?

a.86,794 hours

b.88,320 hours

c.135,600 hours

d.137,500 hours

D'Santos uses a job-order cost system with machine hours as an overhead base. The following information relates to D'Santos for last year:

Estimated machine hours for the year42,000

Actual machine hours for the year40,800

Predetermine overhead rateP1.50 per MH

Underapplied factory overheadP2,600

5.What is the peso amount of the following items?

Estimated OHApplied OHActual OH

a.P 61,200P 63,000P60, 400

b. P61, 20063,00065,600

c.P63, 00061,20018,600

d.P63, 00061,20063,800

Justine Company budgeted total variable overhead costs at P 180,000 for the current period. In addition, they budgeted costs for factory rental P215, 000, costs for depreciation of office equipment at P12, 000 costs for office rent at P92,000, and costs for deprecation of factory equipment at 38, 000. All these costs were based upon estimated machine hours 80,000. At the end of the period, the Factory Overhead control account had a balanced of P387, 875. Actual machine hours were 74,000.

6.What as the over or underapplied factory overhead for the period?

a.P12,650 overapplied

b.P12,650 uderapplied

c.P108,850 overapplied

d.P108,850 underapplied

Candice Company uses activity-based costing to determine the unit product costs for external reports. The company has two products: Candy A and Candy B. The annual production sales of Candy A are 10,000 units and of Candy B are 4,000 units. There are three overhead centers, with estimated overhead costs and expected activity as follows:

Activity Est. overhead Expected Activity

CenterCandy ACandy BTotal

Activity 125,000150100 250

Activity 265,0008002001,000

Activity 390,0001,0002,0003,000

7.The overhead cost per unit of Candy A under activity-based costing is

a.P6.00

b.P9.70

c.P1.50

d.P3.00