Gratis Company Ltd Applies Overhead Based on Direct Labour Hours

question 71

Multiple Choice

Gratis Company Ltd applies overhead based on direct labour hours in their printing department. At the beginning of the year, the company estimated that manufacturing overhead would be $550 000, direct labour hours would be 100 000 and direct labour cost would be $1 100 000 in the printing department. What is the printing department's predetermined overhead rate for the year?

• A) $0.18 per direct labour hour
• B) $0.50 per direct labour hour
• C) $2.00 per direct labour hour
• D) $5.50 per direct labour hour

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Definitions:

Uncertain Position

A situation or status that is not clearly defined or decided, leading to ambiguity or confusion.

Emotional Expressions

The observable verbal and nonverbal behaviors that communicate an individual's emotional state or feelings to others.

Representational Gap

A discrepancy or disconnect between the way something is depicted or conceptualized and its real-world counterpart.

Enticing

The act of attracting or tempting someone or something with the promise of benefit or reward.