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The Clarence Company uses predetermined overhead rates to apply manufacturing overhead to jobs. The predetermined overhead rate is based on labor cost in Dept. A

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The Clarence Company uses predetermined overhead rates to apply manufacturing overhead to jobs. The predetermined overhead rate is based on labor cost in Dept. A and machine-hours in Dept. B. At the beginning of the year, the company made the following estimates: Direct labor cost Manufacturing overhead Direct labor-hours Machine-hours Dept A $50,000 $100,000 7,000 4,000 Dept B $45,000 $60,000 12,000 15,000 What predetermined overhead rates would be used in Dept A and Dept B, respectively? O 50%; $3.00 50%; $3.75 200%; $4.00 200%; $5.00

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