26 Jun WHY DO COMPANIES USE A PREDETERMINED OVERHEAD RATE RATHER THAN ACTUAL OVERHEAD COSTS TO APPLY OVERHEAD TO JOBS?
1. EXERCISE 310 Applying Overhead; Computing Unit Product Cost [LO2 LO3]A company assigns overhead cost to completed jobs on the basis of 120% of direct labor cost. The job cost sheet for Job 413 shows that $12000 in direct materials has been used on the job and that $8000 in direct labor cost has been incurred. A total of 200 units were produced in Job 413.Required:What is the total manufacturing cost assigned to Job 413? What is the unit product cost for Job 413?(check figure unit production cost 148)1. 2.Why do companies use a predetermined overhead rate rather than actual overhead costs to apply overhead to jobs?
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