Profit margin earned if each unit requires two machine

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For 2014, Bakers Manufacturing uses machine-hours as the only overhead cost-allocation base. The direct cost rate is $3.00 per unit. The selling price of the product is $20.00. The estimated manufacturing overhead costs are $240,000 and estimated 40,000 machine hours. The actual manufacturing overhead costs are $300,000 and actual machine hours are 50,000.

1) Using job costing, the 2014 actual indirect-cost rate is _____.

2) What is the profit margin earned if each unit requires two machine-hours?

Please be detailed in explaining your solution.

Reference no: EM13746400

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