Use the Information Below to Answer the Following Question(s)

question 76

Multiple Choice

Use the information below to answer the following question(s) .
Sable Company is debating the use of direct labour cost or direct labour hours as the cost allocation base for allocating manufacturing overhead. The following information is available for the most recent year:

-If Sable Company uses direct labour cost as the allocation base, what would the predetermined manufacturing overhead rate be?

• A) 70%
• B) 80%
• C) 89%
• D) 78%

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Definitions:

Deficit

A financial situation where expenditures exceed revenue.

Security Agreement

A security agreement is a legal document that provides a lender a security interest in a specified asset or property pledged as collateral, detailing the terms regarding the secured transaction.

Repossess

The act of taking back ownership of property, typically when a buyer fails to make the required payments.

Repossessing

The act of taking back possession of property, often because of failure to comply with a contract, such as defaulting on payments.