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Potty Corporation has two production departments, Milling and Finishing. The company uses a job order costing system and computes a predetermined overhead rate in each
Potty Corporation has two production departments, Milling and Finishing. The company uses a job order costing system and computes a predetermined overhead rate in each production department. The Milling Department's predetermined overhead rate is based on machine hours and the Finishing Department's predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made me following estimates: Milling Finishing Machine-hours 20,000 14,000 Direct labor-hours 2,000 8,000 Total fixed manufacturing overhead cost $ 148,000 $ 88, eee Variable manufacturing overhead per machine-hour $ 1.90 Variable manufacturing overhead per direct labor-hour $ 3.60 The predetermined overhead rate for the Finishing Department is closest to
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