Question: Max Company allocates overhead based on direct labor hours. It allocates overhead costs of $16,200 to two different jobs as follows: Job 1: (10 hours)
Max Company allocates overhead based on direct labor hours. It allocates overhead costs of $16,200 to two different jobs as follows: Job 1: (10 hours) = $8,100; Job 2: (10 hours) = $8,100 The production process for Job 2 was then automated. Now Job 2 requires only 2 hours of direct labor but 3 hours of mechanical processing. As a result, total overhead increases to $21,600. With the change in the production process for Job 2, the amount of overhead assigned to: Multiple Choice Job 1 will increase each product will decrease. each product will increase. Job 1 will decrease
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