- Chapter 2 Quiz i Saved Help Save & Exit Subm Garza 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 labor-hours. At the beginning of the current year, the company had made the following estimates: Casting Customizing Machine-hours 23, 000 15, 000 Direct labor-hours 7, 000 7, 000 Total fixed manufacturing overhead cost $82, 800 $30, 100 Variable manufacturing overhead per machine- $ 1. 40 hour Variable manufacturing overhead per direct $ 4.70 labor-hour