Response to the following problem:
Sino-woodworks Ethiopia Ltd makes office furniture from fine hardwoods. The company uses a job-order costing system and predetermined overhead rates to apply manufacturing overhead cost to jobs. The predetermined overhead rate in the Preparation Department is based on machine-hours, and the rate in the Fabrication Department is based on direct materials cost. At the beginning of the year, the company's management made the following estimates for the year:Job-C was started on April 1 and completed on May 12. The company's cost records show the following information concerning the job:
Required:
a) Compute the predetermined overhead rate used during the year in the Preparation and Fabrication Departments.