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Problem - Alpha Company estimates that annual manufacturing overhead costs will be $900,000. Estimated annual operating activity bases are: direct labor cost $450,000, direct labor hours 300,000, and machine hours 100,000.
a. Compute the predetermined overhead rate for each activity base.
b. If Job 101 has 60,000 direct labor hours, compute the manufacturing overhead that it should be assigned using the predetermined overhead rate computed in question a. above.
c. If Job 102 has 25,000 machine hours, compute the manufacturing overhead that it should be assigned using the predetermined overhead rate computed in question a. above.
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