A Radial Tire Manufacturer Produces Products in Two Departments-Division a and B.The

question 9

Multiple Choice

A radial tire manufacturer produces products in two departments-Division A and B.The company uses separate allocation rates for each department to allocate its overhead.Division A and B have estimated manufacturing overhead costs of $150,000 and $ 350,000,respectively.Division A uses machine hours as the allocation base,and Division B uses direct labor hours as the allocation base.The total estimated machine hours were 30,000 and direct labor hours were 20,000 for the year.Calculate the departmental overhead allocation rates.

• A)Division A-$5,Division B-$17.5
• B)Division A-$17.5,Division B-$6
• C)Division A-$6,Division B-$18.2
• D)Division A-$4,Division B-$14.6

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Definitions:

Face Value

The maturity value of a bond. Also known as par value of bond.

Yield Curve

A graph showing the relationship between bond yields and their maturity dates, which can indicate economic expectations.

Liquidity Premium

Forward rate minus expected future short interest rate.

Interest Rates

The cost of borrowing money or the rate paid for the privilege of using someone else's money, usually expressed as a percentage.