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White Company has two departments, lCutting and Finishing. The company uses a job-order costing system and computes a predetermined overhead rate in each department. The

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White Company has two departments, lCutting 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 labor-hours. At the beginning of the year, the company made the following estimates: Deeartment Cutting Finishing Direct laborhours 7,500 9G,DDD Machine-hours 54.3D 4.000 Total fixed manufacturing overhead cost $ 36G,ODD $ 452,000 Variable manufacturing overhead per machinehour $ 2.00 Variable manufacturing overhead per direct labor-hour 5 2.75 Required: 1. Compute the predetermined overhead rate for each department. 2. Thejob cost sheet for Job 203. which was started and completed during the year. showed the following: Deeartment Cutting Finishing Direct labor-hours 3 16 Machinehours 38 5 Direct materials 3 T30 $ 360 Direct labor cost $ 60 $ 320 Using the predetermined overhead rates that you computed in requirement {1], compute the total manufacturing cost assigned to Job 203. 3. Would you expect substantially different amounts of overhead cost to be assigned to some jobs if the company used a plantwide predetermined overhead rate based on direct labor-hours. rather than using departmental rates

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