Asked by Sygie Lamigo on Jul 02, 2024
Coble Woodworking Corporation produces fine cabinets. The company uses a job-order costing system in which its predetermined overhead rate is based on capacity. The capacity of the factory is determined by the capacity of its constraint, which is an automated shaper. Additional information is provided below for the most recent month: 
The manufacturing overhead applied is closest to:
A) $7,500
B) $33,075
C) $8,100
D) $30,625
Job-Order Costing
An accounting method that assigns costs to specific production batches or jobs, useful in industries where goods or services are custom-produced.
Automated Shaper
A machine tool operated using automation for shaping wood, metal, or other materials, enhancing precision and productivity.
Manufacturing Overhead
All manufacturing costs that are not directly related to the production of a product, including indirect labor, maintenance, and utilities.
- Acknowledge the importance of capacity in the calculation of overhead rates and its implications for product costing.
- Allocate indirect costs to products within traditional and activity-based costing frameworks.
Learning Objectives
- Acknowledge the importance of capacity in the calculation of overhead rates and its implications for product costing.
- Allocate indirect costs to products within traditional and activity-based costing frameworks.
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