Manchester Ltd

question 13

Essay

Manchester Ltd. uses a job-order costing system and a predetermined overhead rate based on machine hours.
At the beginning of the year, the company estimated manufacturing overhead for the year would be £135,000 and 9,000 machine hours would be used.
The following information pertains to December of the current year:
Actual manufacturing overhead costs incurred in December were £31,000.
Required:

a.
Compute the predetermined overhead application rate.
b.
Determine the total cost associated with each job.

---

Definitions:

Ordinary Shareholders

Investors who own ordinary shares in a company, granting them rights to dividends and voting in company affairs.