Mortenson & Co. is a construction subcontractor that helps build apartment complexes. The company budgeted the following construction overhead costs for the period:
Mortenson has two service departments (Materials Handling and Equipment Maintenance) and two production departments (Cement and Framing). Budgeted yearly information for these departments is as follows:
Lease and Indirect Materials costs are allocated to each department based on number of vehicles used by the department. Equipment Maintenance costs are allocated based on equipment hours, and Materials Handling costs are allocated based on direct labor hours. Cement costs are allocated to jobs based on direct labor hours, and Framing costs are allocated based on equipment hours.
What is the rate used to apply overhead to jobs in the Cement department?
To the Framing department?
(Do not round intermediate calculations, round final answer to 2 decimal places.)

Question

Mortenson & Co. is a construction subcontractor that helps build apartment complexes. The company budgeted the following construction overhead costs for the period:
  Mortenson has two service departments (Materials Handling and Equipment Maintenance) and two production departments (Cement and Framing). Budgeted yearly information for these departments is as follows:
  Lease and Indirect Materials costs are allocated to each department based on number of vehicles used by the department. Equipment Maintenance costs are allocated based on equipment hours, and Materials Handling costs are allocated based on direct labor hours. Cement costs are allocated to jobs based on direct labor hours, and Framing costs are allocated based on equipment hours.
What is the rate used to apply overhead to jobs in the Cement department?
To the Framing department?
(Do not round intermediate calculations, round final answer to 2 decimal places.)

Quizplus · Accepted Answer

The Answer of Mortenson & Co. is a construction subcontractor that helps build apartment complexes. The company budgeted the following construction overhead costs for the period:
  Mortenson has two service departments (Materials Handling and Equipment Maintenance) and two production departments (Cement and Framing). Budgeted yearly information for these departments is as follows:
  Lease and Indirect Materials costs are allocated to each department based on number of vehicles used by the department. Equipment Maintenance costs are allocated based on equipment hours, and Materials Handling costs are allocated based on direct labor hours. Cement costs are allocated to jobs based on direct labor hours, and Framing costs are allocated based on equipment hours.
What is the rate used to apply overhead to jobs in the Cement department?
To the Framing department?
(Do not round intermediate calculations, round final answer to 2 decimal places.)