Dr. Juan Dempere (jdempere) is sharing content Il ca.bbcollab.com is sharing your Exercise s... 035 Share File Hom Insert Desi Layor Rofer Mailit Revie Viow Dove Acrol2 Telmo Juan D... Exercise 57 Md Marine Components produces parts for airplanes and ships. The parts are produced to specification by their customers, who pay either a fixed price (the price does not depend directly on the cost of the job) or price equal to recorded cost plus a fixed fee (cost plus). For the upcoming year (year 2), Marine expects only two clients (client 1 and client 2). The work done for client I will all be done under fixed-price contracts while the work done for client 2 will all be done under cost-plus contracts. The controller at Marine Components chose direct labor cost as the allocation base in year 2. based on what she considered reflected the relation between overhead and direct labor cost. Year 3 is approaching and again the company only expects two clients: client 1 and client 3. Work for client I will continue to be billed using fixedprice contracts, and client 3 will be billed based on cost.plus contracts. Manufacturing overhead for year 3 is.sstimated to be $12 million. Other budgeted data for year 3 include: Client1 Client 3 Machine-hours (thousands) 3.000 7.000 Direct labor cost (9000) $ 3.000 $ 3.000 Par a. Compute the predetermined rate assuming that Marine Components uses machine-hours to apply overhead 6. Compute the predetermined rate assuming that Marine Components uses direct labor cost to apply overhead Solution: Type here to search Lenovo