Compton Company uses a predetermined overhead rate in applying overhead to production orders on a labour cost basis in Department A and on a machine hours basis in DepartmentB.At the beginning of the most recently completed year,the company made the following estimates: What predetermined overhead rate would be used in Department A and Department B,respectively?
A) 83% and $5.
B) 83% and $3.
C) 120% and $3.
D) 81% and $3.

Question

Compton Company uses a predetermined overhead rate in applying overhead to production orders on a labour cost basis in Department A and on a machine hours basis in DepartmentB.At the beginning of the most recently completed year,the company made the following estimates:  What predetermined overhead rate would be used in Department A and Department B,respectively?
A) 83% and $5. 
B) 83% and $3. 
C) 120% and $3. 
D) 81% and $3.

Quizplus · Accepted Answer

The Answer of Compton Company uses a predetermined overhead rate in applying overhead to production orders on a labour cost basis in Department A and on a machine hours basis in DepartmentB.At the beginning of the most recently completed year,the company made the following estimates:  What predetermined overhead rate would be used in Department A and Department B,respectively?
A) 83% and $5. 
B) 83% and $3. 
C) 120% and $3. 
D) 81% and $3.

Compton Company Uses a Predetermined Overhead Rate in Applying Overhead