Answer the Following Questions Using the Information Below:
Hunter Valley

question 5

Multiple Choice

Answer the following questions using the information below:
Hunter Valley Corporation uses a job cost system and has two production departments,A and B.Budgeted manufacturing costs for the year are:
$$\begin{array}{l}\begin{array} { l r r } & \text { Department A } & \text { Department B } \\\text { Direct materials } & \$ 700000 & \$ 100000 \\\text { Direct manufacturing labour } & \$ 200000 & \$ 800000 \\\text { Manufacturing overhead } & \$ 600000 & \$ 400000\end{array}\\\text { The actual material and labour costs charged to Job \#432 were as follows: }\\\begin{array} { c c } & \text { Total } \\\text { Direct materials: } & \$ 25000 \\\text { Direct labour: } & \\\text { Department A } & \$ 8000 \\\text { Department B } & \$ 12000 \\& \$ 20000\end{array}\end{array}$$ Hunter Valley applies manufacturing overhead costs to jobs on the basis of direct manufacturing labour cost using departmental rates determined at the beginning of the year.
-For Department B,the manufacturing overhead allocation rate is:

• A)50%.
• B)100%.
• C)300%.
• D)200%.

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