answer each of the following questions.

1. Define and explain the meaning of a predetermined manufacturing overhead rate that

is applied in a job order costing system.

2. What are the advantages and disadvantages of using the cost of each print as a manufacturing overhead cost driver?

3. Using the information in Illustrations CA 1-1 and CA 1-2, compute and interpret the

predetermined manufacturing overhead rate for Wall Dcor.

4. Compute the product cost for the following three items.

(a) Lance Armstrong unframed print (base cost of print $12).

(b) John Elway print in steel frame, no mat (base cost of print $16).

(c) Lambeau Field print in wood frame with mat (base cost of print $20).

5. (a) How much of the total overhead cost is expected to be allocated to unframed prints?

(b) How much of the total overhead cost is expected to be allocated to steel-framed

prints?

(c) How much of the total overhead cost is expected to be allocated to wood-framed

prints?

(d) What percentage of the total overhead cost is expected to be allocated to unframed

prints?

6. Do you think the amount of overhead allocated to the three product categories is reasonable?

Relate your response to this question to your fi ndings in previous questions.

7. Anticipate business problems that may result from allocating manufacturing overhead

based on the cost of the prints.