Hickingbottom Corporation Has Two Production Departments, Forming and Finishing

question 128

Multiple Choice

Hickingbottom Corporation has two production departments, Forming and Finishing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Forming Department's predetermined overhead rate is based on machine-hours and the Finishing Department's predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates: During the current month the company started and finished Job M381. The following data were recorded for this job:
The predetermined overhead rate for the Finishing Department is closest to:

• A) $9.40 per direct labor-hour
• B) $13.00 per direct labor-hour
• C) $3.60 per direct labor-hour
• D) $5.35 per direct labor-hour

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Definitions:

Downward Communication Systems

This refers to the flow of information from higher levels of management or leadership down to lower-level employees within an organization, facilitating instructions, policies, and feedback.

Employee Involvement

A management practice whereby employees are given the opportunity to participate in decision-making processes within an organization, thereby contributing to improvements in productivity, morale, and ownership.

Employee Satisfaction

The level of contentment and positive feelings employees have towards their job and workplace environment.

Upward Communication

Communication that begins in the organization and proceeds up the hierarchy to inform or influence others.