The Collins Company uses predetermined overhead rates to apply manufacturing overhead to jobs. The predetermined overhead rate is based on labour cost in Dept. A and machine hours in Dept. B. At the beginning of the year, the company made the following estimates: Dept A Dept B Direct Labour cost £65,000 £42,000 Manufacturing overhead 91,000 48,000 Direct Labour hours 8,000 10,000 Machine hours 3,000 12,000 What predetermined overhead rates would be used in Dept A and Dept B, respectively?

The Collins Company uses predetermined overhead rates to apply manufacturing overhead to jobs. The predetermined overhead rate is based on labour cost in Dept. A and machine hours in Dept. B. At the beginning of the year, the company made the following estimates: Dept A Dept B Direct Labour cost £65,000 £42,000 Manufacturing overhead 91,000 48,000 Direct Labour hours 8,000 10,000 Machine hours 3,000 12,000 What predetermined overhead rates would be used in Dept A and Dept B, respectively?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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