Irene Manufacturing Uses a Predetermined Overhead Allocation Rate Based on Direct

question 4

Multiple Choice

Irene Manufacturing uses a predetermined overhead allocation rate based on direct labor cost.At the beginning of the year,the company estimated total manufacturing overhead costs at $1,020,000 and total direct labor costs at $820,000.In June,Job 711 was completed.The details of Job 711 are shown below. $$\begin{array} { | l | r | } \hline \text { Direct materials cost } & \$ 21,500 \\\hline \text { Direct labor cost } & \$ 10,000 \\\hline \text { Direct labor hours } & 400 \text { hours } \\\hline \text { Units of product produced } & 200 \text { units } \\\hline\end{array}$$ How much was the cost per unit of finished product? (Round any percentages to two decimal places and your final answer to the nearest cent.)

• A)$157.50
• B)$197.70
• C)$169.70
• D)$219.70

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Definitions:

Production Manager

An individual responsible for overseeing the production process, coordinating all activities related to the actual production of goods or services.

Accounts Receivable Balance

The sum total of money that customers are in debt to a company for its goods or services that have been utilized but not paid for.

Firm's Cash Cycle

The length of time it takes a company to convert its investments in inventory and other resources into cash flows from sales.