Apple Valley Corporation uses a job cost system and has two production departments, A and B. Budgeted manufacturing costs for the year are:

The actual material and labor costs charged to Job #432 were as follows:

Apple Valley applies manufacturing overhead costs to jobs on the basis of direct manufacturing labor cost using departmental rates determined at the beginning of the year.
For Department A, the manufacturing overhead allocation rate is ________.
A) 40.0%
B) 50.0%
C) 250.0%
D) 90.0%

Question

Apple Valley Corporation uses a job cost system and has two production departments, A and B. Budgeted manufacturing costs for the year are:

The actual material and labor costs charged to Job #432 were as follows:

Apple Valley applies manufacturing overhead costs to jobs on the basis of direct manufacturing labor cost using departmental rates determined at the beginning of the year.
For Department A, the manufacturing overhead allocation rate is ________.
A) 40.0% 
B) 50.0% 
C) 250.0% 
D) 90.0%

Quizplus · Accepted Answer

$500,000 / $200,000 = 250.0%

Apple Valley Corporation Uses a Job Cost System and Has