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Midwest Corporation has provided the following data concerning manufacturing overhead for 2020: Two jobs were worked on during the year: Job A-101 and Job A-102. The number of direct labor-hours spent on Job A-101 and Job A-102 were 1,360 and 4,200, respectively. The actual manufacturing overhead was $72,200. What is the predetermined manufacturing overhead rate per direct labor hour for the year

Sagot :

Zvikoidn

Answer:

$16.00

Explanation:

Predetermined manufacturing overhead rate = Budgeted Overheads ÷ Budgeted Activity

therefore,

Predetermined manufacturing overhead rate = $32,320 ÷ 2,020

                                                                            = $16.00

Applied overheads = Predetermined manufacturing overhead rate x Actual activity

therefore,

Applied overheads = $16.00 x 2,410 = $38,560

Conclusion :

Under-applied overheads = $72,200 -  $38,560

                                           = $33,640

the predetermined manufacturing overhead rate per direct labor hour for the year is  $16.00

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