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Eva8 [605]
3 years ago
5

Harris Fabrics computes its plantwide predetermined overhead rate annually on the basis of direct labor-hours. At the beginning

of the year, it estimated that 20,000 direct labor-hours would be required for the period’s estimated level of production. The company also estimated $94,000 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $2.00 per direct labor-hour. Harris's actual manufacturing overhead cost for the year was $123,900 and its actual total direct labor was 21,000 hours. Required: Compute the company's plantwide predetermined overhead rate for the year. (Round your answer to 2 decimal places.
Business
1 answer:
wolverine [178]3 years ago
5 0

Answer:

$6.7 per direct labor hour

Explanation:

Given:

Direct labor-hours = 20,000

Fixed manufacturing overhead cost = $94,000

variable manufacturing overhead = $2.00 per direct labor-hour

Actual manufacturing overhead cost for the year = $123,900

Actual total direct labor = 21,000 hours

Now,

Total Estimated Manufacturing Overhead

= 94000 + ( 2 × 20000 )

= $134,000

And,

Predetremined Overhead Rate = \frac{\textup{Estimated Maufacturing Overhead}}{\textup{Estimated Direct Labor Hours.}}

or

Predetremined Overhead Rate = \frac{\textup{134,000}}{\textup{20000}}

or

Predetremined Overhead Rate = $6.7 per direct labor hour

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4 0
1 year ago
A.8<br>B.15<br>C.26<br>D.52<br><br><br><br>if anyon can help i would be so happy
Alika [10]
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