Minton Company Provided the Following Information from Its Accounting Records

question 144

Multiple Choice

Minton Company provided the following information from its accounting records for 2022: $\begin{array}{lr}\text { Estimated production } & 60,000 \text { labor hours } \\\text { Actual production } & 56,000 \text { labor hours } \\\text { Estimated overhead } & \$ 1,800,000 \\\text { Actual overhead } & \$ 1,740,000\end{array}$ How much is the predetermined overhead rate if Minton Company bases it on direct labor hours?

• A)$30.00 per hour
• B)$29.00 per hour
• C)$32.14 per hour
• D)$31.07 per hour

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Definitions:

Income Report

An income report, commonly known as an income statement, is a financial document that shows a company's revenue, expenses, and net income over a specific period.

Lease Payments

Regular payments made by a lessee to a lessor for the use of an asset during the lease term.

Constructively Capitalize

The accounting practice of recognizing an expenditure as a fixed asset and amortizing it over time, despite not being capitalized in a traditional sense.

Operating Leases

A pact that grants permission to use a property without bestowing ownership rights of the said asset.