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Lexington Company's Predetermined Overhead Rate Is $4

Question 37

Multiple Choice

Lexington Company's predetermined overhead rate is $4.00 per direct labor hour.Which of the following equations correctly computes the amount of overhead cost that should be applied to work in process assuming a job required 100 hours but was estimated to require 90 hours?


A) 100 hours × $4 = $400
B) 90 hours × $4 = $360
C) 1 job × $4 = $4
D) None of these answers are correct.

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