The Watts Company uses predetermined overhead rates to apply manufacturing overhead to jobs. The predetermined overhead rate is based on labor cost in Dept. A and on machine hours in Dept. B. At the beginning of the year, the company made the following estimates:
Dept. A = first figure; Dept. B = second figure
Direct labor cost: $30,000; $40,000
Manufacturing overhead: 60,000; 50,000
Direct labor hours: 6,000; 8,000
Machine hours: 2,000; 10,000
What predetermined overhead rates would be used in Dept A and Dept B, respectively?