White Company has two departments: cutting and finishing. The company uses a job-order costing system and computes a predetermined overhead rate in each department. The cutting department bases its rate on machine-hours, and the finishing department bases its rate on direct labour cost. At the beginning of the year, the company made the following estimates: Department Cutting Finishing Direct labour-hours 7,000 35,000 Machine-hours 50,000 5,000 Manufacturing overhead cost $ 525,000 $ 592,000 Direct labour cost $ 70,000 $ 320,000 Required: 1. Compute the predetermined overhead rate to be used in each department. (Round your answers to 2 decimal places.) 2. Assume that the overhead rates that you computed in Requirement (1) are in effect. The job cost sheet for job 203, which was started and completed during the year, showed the following: Department Cutting Finishing Direct labour-hours 6 20 Machine-hours 80 4 Materials requisitioned $ 460 $ 270 Direct labour cost $ 66 $ 150 Compute the total overhead cost applied to job 203. (Do not round intermediate calculations and round your answer to 2 decimal places.) 3. Would you expect substantially different amounts of overhead cost to be assigned to some jobs if the company used a plantwide overhead rate based on direct labour cost, rather than using departmental rates? multiple choice Yes No

White Company has two departments: cutting and finishing. The company uses a job-order costing system and computes a predetermined overhead rate in each department. The cutting department bases its rate on machine-hours, and the finishing department bases its rate on direct labour cost. At the beginning of the year, the company made the following estimates: Direct labour-hours Machine-hours Manufacturing overhead cost Direct labour cost Department Cutting Finishing 7,000 35,000 50,000 5,090 $525,000 $592,eee $ 70,00 $320,000 Required: 1. Compute the predetermined overhead rate to be used in each department. (Round your answers to 2 decimal places.) Department Cutting Finishing % of DLC Predetermined overhead rate per MH 2. Assume that the overhead rates that you computed in Requirement (1) are in effect. The job cost sheet for job 203, which was started and completed during the year, showed the following: Direct labour-hours Machine-hours Materials requisitioned Direct labour cost Department Cutting Finishing 6 20 80 4 $460 $270 $ 66 $150 Compute the total overhead cost applied to job 203. (Do not round Intermediate calculations and round your answer to 2 decimal places.) Total overhead cost applied 3. Would you expect substantially different amounts of overhead cost to be assigned to some jobs if the company used a plantwide overhead rate based on direct labour cost, rather than using departmental rates? Yes O No