High Desert Potteryworks makes a variety of pottery products
that it sells to retailers. The company uses a job-order costing
system in which departmental predetermined overhead rates are used
to apply manufacturing overhead cost to jobs. The predetermined
overhead rate in the Molding Department is based on machine-hours,
and the rate in the Painting Department is based on direct
labor-hours. At the beginning of the year, the company provided the
following estimates:
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