Sweeten Company had no jobs in progress at the beginning of the year and no beginning inventories. It started, completed, and sold only two jobs during the year$—$Job P and Job Q$.$ The company uses a plantwide predetermined overhead rate based on machine$-$hours. At the beginning of the year, it estimated that $4,000$ machine$-$hours would be required for the period$’$s estimated level of production. Sweeten also estimated $$28,200$ of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $$2\mathrm{.}50$ per machine$-$hour.

Because Sweeten has two manufacturing departments$—$Molding and Fabrication$—$it is considering replacing its plantwide overhead rate with departmental rates that would also be based on machine$-$hours. The company gathered the following additional information to enable calculating departmental overhead rates:

Molding Fabrication Total

Estimated total machine$-$hours used $2,5001,5004,000$

Estimated total fixed manufacturing overhead $ $12,000$ $ $16,200$ $ $28,200$

Estimated variable manufacturing overhead per machine$-$hour $ $2\mathrm{.}20$ $ $3\mathrm{.}00$ 

The direct materials cost, direct labor cost, and machine$-$hours used for Jobs P and Q are as follows:

Job P Job Q

Direct materials $ $21,000$ $ $12,000$

Direct labor cost $ $27,400$ $ $10,700$

Actual machine$-$hours used:

Molding $2,5001,600$

Fabrication $1,4001,700$

Total $3,9003,300$

Sweeten Company had no overapplied or underapplied manufacturing overhead costs during the year.

Required:

For questions $1-8,$ assume that Sweeten Company uses a plantwide predetermined overhead rate with machine$-$hours as the allocation base. For questions, $9-15,$ assume that the company uses predetermined departmental overhead rates with machine$-$hours as the allocation base in both departments.

$1.$ What is the company$’$s plantwide predetermined overhead rate?

Note: Round your answer to $2$ decimal places.

 

Answer rating: 100% (QA)

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