a. The predetermined overhead rate is $85 Per DHL
b. The unit product cost of each model are:
•N800 $384
•N500 $128
a. Computation for the predetermined overhead rate
Using this formula
Plantwide predetermined overhead rate= Estimated total costs/Total direct labour hours
Let plug in the formula
Plantwide predetermined overhead rate = 1,785,000 / 21,000
Plantwide predetermined overhead rate =$85 Per DHL
b. Computation of Unit product Cost for each models
N800 N500
Direct material $75.00 $25.00
Direct labour $54.00 $18.00
($18 per hour×3.0=$54)
($18 per hour×1.0=$18)
Overhead $225.00 $75.00
(85×3=$255) (85×1.0=$85)
Total Unit cost $384.00 $128.00
Inconclusion a. The predetermined overhead rate is $85 Per DHL
b. The unit product cost of each model are:
•N800 $384
•N500 $128
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