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Grouper Company produces one product, a putter called GO-Putter. Grouper uses a standard cost system and determines that it should take one hour of direct
Grouper Company produces one product, a putter called GO-Putter. Grouper uses a standard cost system and determines that it should take one hour of direct labor to produce one GO-Putter. The normal production capacity for this putter is 96,000 units per year. The total budgeted overhead at normal capacity is $854,400 comprised of $259,200 of variable costs and $595,200 of fixed costs. Grouper applies overhead on the basis of direct labor hours. During the current year, Grouper produced 91,200 putters, worked 90,400 direct labor hours, and incurred variable overhead costs of $245,600 and fixed overhead costs of $576,000. (a) Compute the predetermined variable overhead rate and the predetermined fixed overhead rate. (Round answers to 2 decimal places, e.g. 2.75.) Predetermined Overhead Rate Variable Fixed
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