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Langston Automotive Accessories applies overhead using a combined rate for fixed and variable OH. The rate is 250 percent of direct labor cost. During the first three months of the current year, actual costs incurred were as follows:
Direct Labor Cost Actual OverheadJanuary $180,000 $440,000February 165,000 420,400March 170,000 421,000
a. What amount of overhead was applied to production in each of the three months?
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In your own words, explain what is meant by "inductive reasoning" and "deductive reasoning." State the differences between the two and provide examples to illustrate.
Management believes that electrical cost is a mixed cost that depends on machine-hours. Using the high-low method to estimate the variable and fixed components of this cost, these estimates would be closest to:
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Manning Imports is contemplating an agreement to lease equipment to a customer for five years. Manning normally sells the asset for a cash price of $100,000. Assuming that 8% is a reasonable rate of interest.
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