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Check my work Landen Corporation uses a job-order costing system. At the beginning of the year, the company made the following estimates: Direct labor-hours required to support estimated production Machine-hours required to support estimated production Fixed manufacturing overhead cost Variable manufacturing overhead cost per direct labor-hour Variable manufacturing overhead cost per machine-hour 140,000 70,000 $784,000 $ 2.00 $4.00 1.25 points eBook Print During the year, Job 550 was started and completed. The following information is available with respect to this job Direct materials Direct labor cost Direct labor-hours Machine-hours $ 175 $ 225 15 Required 1. Assume that Landen has historically used a plantwide predetermined overhead rate with direct labor-hours as the allocation base Under this approach: a. Compute the plantwide predetermined overhead rate b. Compute the total manufacturing cost of Job 550. C. lf Landen uses a markup percentage of 200% of its total manufacturing cost, what selling price would it establish for Job 550? 2. Assume that Landens controller believes that machine-hours is a better allocation base than direct labor-hours. Under this approach: a. Compute the plantwide predetermined overhead rate b. Compute the total manufacturing cost of Job 550. c. If Landen uses a markup percentage of 200% of its total manufacturing cost, what selling price would it establish for Job 550? (Round your intermediate calculations to 2 decimal places. Round your Predetermined Overhead Rate answers to 2 decimal

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Solution: 1)a Predetermined overhead rate = Estimated overhead cost/ Base Fixed MOH Rate = (784000/140000- Variable MOH rate

2)a Predetermined overhead rate = Estimated overhead cost/ Base Fixed MOH Rate (784000/70000)- Variable MOH rate per MH- Pred

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