Question

4. Minjae Company uses departmental manufacturing overhead rates to apply overhead. Direct labor cost is used to apply manufa

A. Calculate the predetermined overhead rate for Dept. A and for Dept. B. - Predetermined Fact O/H Rate Budget/Estimate/Predi

What are the calculations to solving part B?

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  • Requirement [a]

Budgeted cost

Budgeted DL cost/MHs

Predetermined Overhead rate

Dept A

$79,200

$66,000

120% of direct labor cost OR $1.20

per $ of direct labor cost

Dept B

$60,000

                                     15,000

$4.00

per Mhs

  • Requirement [b]

Predetermined Overhead rate

Actual Activity

Applied Factory Overhead

Dept A

120% of direct labor cost OR $1.20

$68,400

$82,080

Answer

Dept B

$4.00

14600

$58,400

Answer

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