Prime Products manufactures specialized goods to customers’ specifications and operates a job-order costing system. Manu

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Prime Products manufactures specialized goods to customers’
specifications and operates a job-order costing system.
Manufacturing overhead cost is applied to jobs on the basis of
direct labour cost. The following estimates were made at the
beginning of the year:
Jobs require varying amounts of work in the three departments.
The Hastings job, for example, would have required manufacturing
costs in the three departments as follows:
The company uses a plantwide overhead rate to apply
manufacturing overhead cost to jobs.
Required:
1. Assuming the use of a plantwide overhead
rate:
a. Compute the rate for the current
year.
b. Determine the amount of
manufacturing overhead cost that would have been applied to the
Hastings job.
2. Suppose that instead of using a plantwide
overhead rate, the company had used a separate predetermined
overhead rate in each department. Under these conditions:
a. Compute the rate for each
department for the current year.