ers 2 to 4) Help Save & Exit Su Coble Woodwork ing Corporation produces fine cab
ID: 341004 • Letter: E
Question
ers 2 to 4) Help Save & Exit Su Coble Woodwork ing Corporation produces fine cabinets. The company uses a job-order costing system in which ts predetermined overhead rate is based on capacity. The capacity of the factory is determined by the capacity of ts constraint, which is an automated shaper Additional information is provided below for the most recent month: Estimates at the beginning of the month: Estimated total fixed manufacturing overhead $33,075 Capacity of the shaper 270 hours Actual results: $79,268 $12,200 $17,400 Sales Direct materials Direct labor Actual total fixed manufacturing overhead$33,075 Selling and administrative expense Actual hours of shaper use 8,100 250 hours The predetermined overhead rate based on hours at capacity is closest toExplanation / Answer
Calculation of predetermined overhead rate:
=Estimated manufacturing OH/ Estimated hours
=$33075/270 hours
=$122.5 per hour.
Correct option is the second one.
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