Horatio Ltd If Total Manufacturing Overhead Costs During the Month Totalled $10

question 44

Multiple Choice

Horatio Ltd.uses job order costing to measure and track product costs.Horatio has determined that machine hours drive its manufacturing overhead costs.During the month of June,the following data were available for Product #80:
$$\begin{array} { l l } \text { Direct labour } & 350 \text { hours at } \$ 10 \text { per hour } \\\text { Direct materials } & 40 \text { square yards at } \$ 25 \text { per yard }\\\text { Machine hours usedd }&1000\text{hour}\end{array}$$
If total manufacturing overhead costs during the month totalled $10 000 when a total of 25 000 machine hours were used,what will be the total manufacturing cost of Product #80?

• A) $7000
• B) $5500
• C) $4900
• D) $4500

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Definitions:

Commercial Impracticability

A legal doctrine under which a party may be released from a contract when events render performance commercially impracticable.

Revocation of Acceptance

The right to reject goods or services under a contract after initially accepting them, under specific circumstances.

Uniform Computer Information Transactions Act

A proposed set of laws aimed at harmonizing the legal treatment of transactions in computer information and digital products.

Perfect Tender Rules

Legal standards within the Uniform Commercial Code (UCC) that require sellers to deliver goods to buyers exactly as agreed in their contract.