A company estimates the following manufacturing costs at the beginning of the period: direct labor, $936,000; direct materials, $780,000; and factory overhead, $234,000. The company’s predetermined overhead rate as a percent of direct labor is 400%.

T/F

Angler Industries produces a product which goes through two operations, Assembly and Finishing, before it is ready to be shipped. Next year’s expected costs and activities are shown below.

	Assembly		Finishing
Direct labor hours	100,000	DLH	140,000	DLH
Machine hours	300,000	MH	60,000	MH
Overhead costs	$ 300,000		$ 420,000

Assume that Angler Industries allocates overhead using a plantwide overhead rate based on machine hours. How much total overhead will be assigned to a product that requires 1 direct labor hour and 2.5 machine hours in the Assembly Department, and 3.5 direct labor hours and 0.5 machine hours in the Finishing Department?

Multiple Choice

• $7.50.

• $10.50.

• $11.00.

• $13.00.

• $6.00.

Answer rating: 100% (QA)

Solution Answer 1 The correct answer is false Explanation Predetermined overhead rateEsti... View the full answer