Calculate the cost application rate

Reference no: EM132088985

Question: The Yoko Ono Company (YOC) has two production departments: machining and assembly. The budget for the coming year includes budgeted indirect production costs (rent, shop supplies, depreciation, etc). Machining has budgeted indirect production costs of $800,000 and is expected to use 10,000 labor hours and 80,000 machine hours. Assembly has budgeted indirect production costs of $600,000 and is expected to use 30,000 labor hours, but no machine hours. Assume that YOC uses one firm-wide rate based on direct labor hours to apply all indirect production costs. Calculate the cost application rate.

Reference no: EM132088985

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