Almaraz Corporation has two manufacturing departments--Forming and Finishing.The company used the following data at the beginning of the year to calculate predetermined overhead rates:
Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours.That predetermined manufacturing overhead rate is closest to:

Question

Almaraz Corporation has two manufacturing departments--Forming and Finishing.The company used the following data at the beginning of the year to calculate predetermined overhead rates:
 Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours.That predetermined manufacturing overhead rate is closest to:

Quizplus · Accepted Answer

The first step is to calculate the estimated total overhead costs in the two departments.
Forming
 11ea7761_191f_0db7_81a5_0f56bd0adc22_TB2580_00 Finishing
 11ea7761_191f_34c8_81a5_a54b3bb194fe_TB2580_00 The second step is to combine the estimated manufacturing overhead costs in the two departments ($49,700 + $16,500 = $66,200) to calculate the plantwide predetermined overhead rate as follow:
 11ea7761_191f_34c9_81a5_a96a79a16ad4_TB2580_00

Almaraz Corporation Has Two Manufacturing Departments--Forming and Finishing