Stone Cliff Company Manufactures Custom-Order Furniture

question 2

Multiple Choice

Stone Cliff Company manufactures custom-order furniture.During 2020, actual manufacturing overhead totaled $720,000.Based on the 2020 results, and projected production for 2021, management prepared the 2021 budget and estimated that manufacturing overhead would total $800,000.The estimated number of direct labor hours for 2021 is 50,000, and the estimated amount of direct labor cost is $1,000,000.The company plans to use direct labor hours as the basis to allocate overhead to jobs.During May and June 2021, employees worked on the following four jobs: What is the predetermined overhead rate that Stone Cliff will use to allocate overhead during 2021?

• A)$8.00 per direct labor hour
• B)$16.00 per direct labor hour
• C)$14.40 per direct labor hour
• D)$7.20 per direct labor hour

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Definitions:

Settlement

An agreement reached between parties in a dispute, often outside of court, to resolve claims without further litigation.

Structured Settlement Process

A legal agreement to pay someone who has won a lawsuit a sum of money in multiple installments over time rather than in a single lump sum.

Limited Discovery

A pre-trial procedure in a lawsuit in which each party can obtain evidence from the other party or parties by means of discovery devices but with limitations set by the court.

Managers

Individuals in an organization responsible for directing and overseeing the work of a group of people toward the achievement of goals.