Answer:
b. $5.50 per direct labor-hour
Explanation:
The computation of the predetermined overhead rate is shown below:
= (Total estimated manufacturing overhead) ÷ (estimated direct labor-hours)
where,
Total estimated manufacturing overhead = Total fixed manufacturing overhead cost + variable manufacturing overhead per direct labor hour × direct labor hours
= $90,000 + $3.70 × 50,000 direct labor hours
= $90,000 + $185,000
= $275,000
And, the direct labor hour is 50,000
So, the predetermined overhead rate is
= $275,000 ÷ 50,000 direct labor hours
= $5.50 per direct labor-hour
