Question
Fancy Decorating uses a job order costing system to collect the costs of its interior decorating business. Each client's consultation is treated as a separate
Fancy Decorating uses a job order costing system to collect the costs of its interior decorating business. Each client's consultation is treated as a separate job. Overhead is applied to each job based on the number of decorator hours incurred. Listed below are data for the current year.
Budgeted overhead $940,000
Actual overhead $970,000
Budgeted decorator hours 60,000
Actual decorator hours 59,000
What is the predetermined overhead rate you will use in applying overhead into work in process?
a. | $ 15.67 per decorator hour. | |
b. | $31.75 per decorator hour. | |
c. | $ 22.80 per decorator hour. | |
d. | $33.49 per decorator hour. |
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