Compton Company Uses a Predetermined Overhead Rate in Applying Overhead

question 49

Multiple Choice

Compton Company uses a predetermined overhead rate in applying overhead to production orders on a labour cost basis in Department A and on a machine hours basis in DepartmentB.At the beginning of the most recently completed year,the company made the following estimates: What predetermined overhead rate would be used in Department A and Department B,respectively?

• A) 83% and $5.
• B) 83% and $3.
• C) 120% and $3.
• D) 81% and $3.

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Definitions:

Axon Terminals

The endings of axons that transmit signals to other neurons or muscle cells through synapses.

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A neurotransmitter involved in controlling movement and posture, moderating mood, and plays a central role in the reward system of the brain.

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A selective barrier that prevents certain substances in the bloodstream from entering the brain, protecting it from toxins and infections.