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1. Compton Company uses a predetermined overhead rate in applying overhead to production orders on a labor cost basis in Department A and on a machine-hours basis in Department B. At the beginning of the most recently completed year, the company made the following estimates: Dept.A Dept.B Direct labor cost $ 58,000 $ 35,000 Manufacturing overhead $ 70,760 $ 51,200 Direct labor-hours 8,200 9,200 Machine-hours 4,200 16,000 What predetermined overhead rate would be used in Department A and Department B, respectively?

a. 82% and $5.57

b. 122% and $3.20

c. 82% and $3.20

d. 82% and $3.80

2. The actual manufacturing overhead incurred at Hogans Corporation during April was $51,800, while the manufacturing overhead applied to Work in Process was $66,000. The company's Cost of Goods Sold was $281,000 prior to closing out its Manufacturing Overhead account. The company closes out its Manufacturing Overhead account to Cost of Goods Sold. Which of the following statements is true?

a.	Manufacturing overhead was overapplied by $266,800; Cost of Goods Sold after closing out the Manufacturing Overhead account is $295,200
b.	Manufacturing overhead was underapplied by $14,200; Cost of Goods Sold after closing out the Manufacturing Overhead account is $295,200
c.	Manufacturing overhead was underapplied by $14200; Cost of Goods Sold after closing out the Manufacturing Overhead account is $266800
d.	Manufacturing overhead was overapplied by $14,200; Cost of Goods Sold after closing out the Manufacturing Overhead account is $266,800

3. Daane Company had only one job in process on May 1. The job had been charged with $1,000 of direct materials, $2,142 of direct labor, and $3,582 of manufacturing overhead cost. The company assigns overhead cost to jobs using the predetermined overhead rate of $19.90 per direct labor-hour.

During May, the following activity was recorded:

Raw materials (all direct materials):
Beginning balance	$	7,700
Purchased during the month	$	17,500
Used in production	$	24,600
Labor:
Direct labor-hours worked during the month		1,100
Direct labor cost incurred	$	13,090
Actual manufacturing overhead costs incurred	$	20,620
Inventories:
Raw materials, May 30	$	?
Work in process, May 30	$	12,562

Work in process inventory on May 30 contains $3,094 of direct labor cost. Raw materials consist solely of items that are classified as direct materials.

The entry to dispose of the underapplied or overapplied manufacturing overhead cost to cost of goods sold for the month would include a:

a.	credit of $1,270 to Manufacturing Overhead.
b.	debit of $1,270 to Manufacturing Overhead.
c.	credit of $5,174 to Manufacturing Overhead.
d.	debit of $5,174 to Manufacturing Overhead.

4. During February, Degan Inc. transferred $55,000 from Work in Process to Finished Goods and recorded a Cost of Goods Sold of $60,000 (assume there was enough beginning balance in the Finished goods inventory account). The journal entries to record these transactions would include a:

	a. debit to Finished Goods of $60,000
	b. credit to Cost of Goods Sold of $60,000
	c. credit to Finished Goods of $55,000
	d. credit to Work in Process of $55,000

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