Question
Eisentrout Corporation has two production departments, Machining and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production
Eisentrout Corporation has two production departments, Machining and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Machining Departments predetermined overhead rate is based on machine-hours and the Customizing Departments predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates:
MachiningCustomizingMachine-hours27,00018,000Direct labor-hours7,0006,000Total fixed manufacturing overhead cost$ 145,800$ 18,600Variable manufacturing overhead per machine-hour$ 1.80 Variable manufacturing overhead per direct labor-hour $ 3.10
During the current month the company started and finished Job T272. The following data were recorded for this job:
Job T272:MachiningCustomizingMachine-hours4030Direct labor-hours3030
The estimated total manufacturing overhead for the Machining Department is closest to:
Multiple Choice
$178,200
$194,400
$145,800
$48,600
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