Answer:
Predetermined Overhead rate is $28.7 per unit
Explanation:
Estimated Manufacturing overhead = Estimated variable manufacturing overhead + estimated total fixed manufacturing overhead
Estimated Manufacturing overhead = ( 80,000 x $10.70 ) + $1,440,000
Estimated Manufacturing overhead = $856,000 + $1,440,000
Estimated Manufacturing overhead = $2,296,000
Estimated Labor hours = 80,000 hours
Predetermined Overhead rate = Estimated Manufacturing overhead / Estimated Labor hours
Predetermined Overhead rate = 2,296,000 / 80,000
Predetermined Overhead rate = $28.7 per unit
