Establishing the predetermined overhead rates

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Reference no: EM13765906

Autovalet Manufacturing uses a job order cost system in each of its three manufacturing departments. Manufacturing overhead is applied to jobs on the basis of direct labour cost in Department A, direct labour hours in Department B and machine hours in Department C. The following estimates were used in establishing the predetermined overhead rates for 2014: Department

A		B		C
Manufacturing Overhead	$840,000		$902,000		$850,000
Direct Labour Cost	$600,000		$100,000		$600,000
Direct Labour Hours	50,000		41,000		50,000
Machine Hours	100,000		120,000		170,000

Reference no: EM13765906

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