Lavender corporation uses a job-order costing system and, Ask an Expert

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Lavender Corporation uses a job-order costing system and applies manufacturing overhead usinga predetermined overhead rate based on direct laborhours. The following data are availiable for August:

Inventory Begining Ending

Raw Material(all direct material $28,000 $32,000

Work in process $ 600 $15,000

Finished Goods $35,000 $23,000

Actual Cost for August:

Raw material purchase $51,000

Direct labor salaries paid $90,000

Direct labor pay rate er hour $ 15

Manufacturing overhead incurred $49,000

Information from Lavender's budget:

Manufacturing overhead budgeted per month $60,000

Direct labor hours budgeted per month 7500

Q1. Compute the predetermined overhead rate

Q2. For the same company above, compute the manufacturing cost for August:

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9957490

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