Barbeau Corporation has two production departments, Milling and Customizing. The company uses a job-order costing system and computes a predetermined overhead rate in each production department. The Milling Department's predetermined overhead rate is based on machine-hours and the Customizing Department's predetermined overhead rate is based on direct labor-hours. At the beginning of the current year, the company had made the following estimates: MillingCustomizingMachine-hours 17,000 13,000Direct labor-hours 2,000 5,000Total fixed manufacturing overhead cost$119,000$42,000Variable manufacturing overhead per machine-hour$1.60 Variable manufacturing overhead per direct labor-hour $4.30 During the current month the company started and finished Job A492. The following data were
recorded for this job: Job A492:MillingCustomizingMachine-hours 90 20Direct labor-hours 20 50The estimated total manufacturing overhead for the Customizing Department is closest to:
A. $42,000
B. $33,853
C. $63,500
D. $21,500
Answer: C
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