Question

Petty Corporation has two production departments, Milling and Finishing. The company uses a Job-order costing system and computes a predetermined overhead rate in each production department. The Milling Depart predetermined overhead rate is based on machine-hours and the Finishing Department's predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the fo estimates: Milling 20,000 2,000 $148,000 $ 1.90 Finishing 14,000 8,000 $88,000 Machine-hours Direct labor-hours Total fixed manufacturing overhead cost Variable manufacturing overhead per machine-hour Variable manufacturing overhead per direct labor-hour $ 3.60 The estimated total manufacturing overhead for the Milling Department is closest to: Multiple Choice O $38.000 O $408.000 O $140,000 O $196,000

Answer 1

Please give positive ratings so I can keep answering. It would help me a lot. Please comment if you have any query. Thanks!

Petty Corporation
Manufacturing Overhead	Amount $
Machine hours	20,000.00	A
Variable Manufacturing Overhead per hour	1.90	B
Variable Manufacturing Overhead	38,000.00	C=A*B
Add: Fixed Manufacturing Overhead	148,000.00
Total Manufacturing Overhead for Milling Department	186,000.00
Answer is $ 186,000.