Ask Question
17 December, 23:40

Jurica Corporation has two production departments, Forming and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Forming 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: Forming Customizing Machine-hours 19,000 15,000 Direct labor-hours 4,000 6,000 Total fixed manufacturing overhead cost $ 100,700 $ 63,000 Variable manufacturing overhead per machine-hour $ 2.00 Variable manufacturing overhead per direct labor-hour $ 3.90 The predetermined overhead rate for the Forming Department is closest to:

A. $23.12 per machine-hour

B. $5.30 per machine-hour

C. $2.00 per machine-hour

D. $7.30 per machine-hour

+2
Answers (1)
  1. 17 December, 23:55
    0
    D. $7.30 per machine hour

    Explanation:

    The computation of Overhead Per Machine Hour is shown below:-

    Overhead Per Machine Hour = Fixed Cost + Variable Overhead Cost : Number of hours

    = ($100,700 + (19,000 * $2)) : 19,000

    = ($100,700 + $38,000) : 19,000

    = $138,700 : 19,000

    = $7.30 per machine hour

    So, for computing the Overhead Per Machine Hour we simply applied the above formula.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Jurica Corporation has two production departments, Forming and Customizing. The company uses a job-order costing system and computes a ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers