Kubes Corporation Uses a Job-Order Costing System with a Single

question 121

Multiple Choice

Kubes Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on direct labor-hours. The company based its predetermined overhead rate for the current year on total fixed manufacturing overhead cost of $90,000, variable manufacturing overhead of $3.50 per direct labor-hour, and 30,000 direct labor-hours. The company has provided the following data concerning Job A477 which was recently completed:

-The predetermined overhead rate for the Assembly Department is closest to:

• A) $3.00 per direct labor-hour
• B) $12.70 per direct labor-hour
• C) $9.70 per direct labor-hour
• D) $5.35 per direct labor-hour

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Definitions:

Accounts Payable

Obligations or debts a company owes to its suppliers or vendors for products or services received.

Direct Method

A costing methodology that directly assigns specific costs to relevant objects without using allocation for indirect costs.

Cost Of Goods Sold

Costs directly related to the goods a company sells, covering both the materials' cost and the labor cost involved in making the product.

Balance Sheet Accounts

These are the accounts that reflect the financial position of a business at a specific point in time, including assets, liabilities, and equity.