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Problem - Logan Products computes its predetermined overhead rate annually on the basis of machine-hours. At the beginning of the year, it estimated that its total manufacturing overhead would be $355,500 and machines would be run a total of 23,500 hours. Its actual total manufacturing overhead for the year was $343,400 and its actual total machine-hours was 23.000 hours.
Required - Compute the company's predetermined overhead rate for the year, calculate the total overhead applied, and determine the amount of under- or overapplied overhead in the year.
In other words, how would you explain the appropriate accounting treatment to a colleague, boss, or business partner who has a basic understanding of accounting
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FOR YOU AND THE CLASS: How is this ratio calculated and explain its importance and why is it calculated for discontinued operations
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