INCLUDE SOLUTIONS

1. ACER Corporation applies manufacturing overhead on the basis of machine hours (normal costing) and has provided the following data for its most recent year of operations:

Est MOH	224,550
Est machine hours	4,500
Actual MOH	224,000
Actual machine hours	4,440

The estimates of the manufacturing overhead and of machine-hours were made at the beginning of the year for the purpose of computing the company's predetermined overhead rate for the year.

1.a.) The manufacturing overhead for the year was ______________________.

a. 2,444 overapplied

b. 2,444 underapplied

c. 2,994 overapplied

d. 2,994 underapplied

1.b) The predetermined overhead rate is closest to _________ .

a. 49.78

b. 49.23

c. 50.45

d. 49.90

2. GREEN CAB Corporation has provided the following production and total cost data for two levels of monthly production volume. The company produces a single product.

Production volume	6,000 units	7,000 units
DM (variable)	340,200	396,900
DL (variable)	81,000	94,500
MOH	1,003,200	1,015,000

2.a) The best estimate of the total fixed manufacturing cost is _____________.

a. 1,506,400

b. 1,465,400

c. 932,400

d. 1,424,400

2.b.) The best estimate of the cost to manufacture 6,300 units is closest to ______________.

a. 1,449,000

b. 1,495,620

c. 1,425,690

d. 1,355,760

2.c) Thebest estimate of the total variable manufacturing cost per unit is ________.

a. 11.80

b. 70.20

c. 82.00

d. 56.70