Chapter 7, Problem 7.14E

Can you solve this financial accounting problem with appropriate steps and explanations?

Smith Manufacturing estimates that its employees will utilize150,000 machine hours during the coming year. Total overhead costs are estimated to be $6,000,000, and direct labor hours are estimated to be 90,000.Actual machine hours are 110,000, and actual labor hours are 70,000. If Smith Manufacturing allocates overhead based on machine hours, what is the predetermined manufacturing overhead rate?

Which of the following is a current liability? (a)Notes Payable (due in 2 years) (b)Bonds Payable (c)Equipment (d)Unearned Revenue