Tarnish Industries produces miniature models of farm equipment. These collectibles are in great demand. It takes two operations, molding and finishing, to complete the miniatures. Next year's expected activities are shown in the following table:

-Tarnish Industries uses departmental overhead rates and is planning on a $2 per machine hour overhead rate for the molding department.Compute the estimated manufacturing overhead cost for the molding department given the information shown in the table.
A)$195,000
B)$196,000
C)$163,000
D)$321,000
E)$471,000

Question

Tarnish Industries produces miniature models of farm equipment. These collectibles are in great demand. It takes two operations, molding and finishing, to complete the miniatures. Next year's expected activities are shown in the following table:

-Tarnish Industries uses departmental overhead rates and is planning on a $2 per machine hour overhead rate for the molding department.Compute the estimated manufacturing overhead cost for the molding department given the information shown in the table.
A)$195,000 
B)$196,000 
C)$163,000 
D)$321,000 
E)$471,000

Quizplus · Accepted Answer

The estimated manufacturing overhead cost for the molding department can be calculated by multiplying the planned overhead rate ($2 per machine hour) by the total machine hours. Unfortunately, the table with the necessary information (total machine hours) is not provided in the question. However, based on the correct answer provided (B), we can infer that the total machine hours planned for the molding department must be 98,000 hours (since $196,000 divided by $2 per machine hour equals 98,000 machine hours).

Tarnish Industries Produces Miniature Models of Farm Equipment