Question

Calculate the predetermined overhead rate per direct labor hour if the average direct labor rate is $12.21 per hour. 2. Determine the amount of applied overhead if 19,000 actual hours are worked in the upcoming year.

Answer 1

Answer:

Instructions are below.

Explanation:

We weren't provided with enough information to calculate the requirements. But, I will provide the formulas and a small example.

For example:

Estimated overhead for the period= $750,000

Estimated direct labor hours= 25,000

Actual hours= 19,000

To calculate the predetermined manufacturing overhead rate we need to use the following formula:

Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Predetermined manufacturing overhead rate= 750,000/25,000

Predetermined manufacturing overhead rate= $30 per direct labor hour

Now, we can allocate overhead:

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Allocated MOH= 30*19,000

Allocated MOH= $570,000