Reference no: EM133115590

Questions -

Q1 - Mahon Corporation has two production departments, Casting and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Casting Department's predetermined overhead rate is based on machine-hours and the Customizing Department's predetermined overhead rate is based on direct labour-hours. At the beginning of the current year, the company had made the following estimates:

	Casting	Customizing
Machine-hours	14,600	12,600
Direct labour-hours	5,200	6,300
Total fixed manufacturing overhead cost	$116,800	$49,770
Variable manufacturing overhead per machine-hour	$1.60
Variable manufacturing overhead per direct labour-hour		$3.10

During the current month the company started and finished Job T138. The following data were recorded for this job:

Job T138:	Casting	Customizing
Machine-hours	70	40
Direct labour-hours	14	80

What the amount of overhead applied in the Customizing Department to Job T138?

a. $564.00

b. $69,300.00

c. $880.00

d. $282.00

Q2 - Labour-hours for the upcoming year at 34,700 labour-hours. The estimated variable manufacturing overhead was $6.11 per labour-hour and the estimated total fixed manufacturing overhead was $774,851. The actual labour-hours for the year turned out to be 31,000 labour-hours. What the predetermined overhead rate for the recently completed year?

a. $28.44 per labour-hour

b. $22.33 per labour-hour

c. $6.11 per labour-hour

d. $31.83 per labour-hour