JM Manufacturing computes its predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year, it estimated that 31,500 direct labor-hours would be required for the period's estimated level of production. The company also estimated $540,000 of fixed manufacturing overhead expenses for the coming period and variable manufacturing overhead of $2.80 per direct labor-hour. JM's actual manufacturing overhead for the year was $678,920, and its actual total direct labor was 32,000 hours. Required: Compute the company's predetermined overhead rate for the year. (Round your answer to 2 decimal places.) Predetermined overhead rate: _____ Per DLH.
JM Manufacturing computes its predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year, it estimated that 31,500 direct labor-hours would be required for the period's estimated level of production. The company also estimated $540,000 of fixed manufacturing overhead expenses for the coming period and variable manufacturing overhead of $2.80 per direct labor-hour. JM's actual manufacturing overhead for the year was $678,920, and its actual total direct labor was 32,000 hours. Required: Compute the company's predetermined overhead rate for the year. (Round your answer to 2 decimal places.) Predetermined overhead rate: _____ Per DLH.
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter7: The Master Budget And Flexible Budgeting
Section: Chapter Questions
Problem 23Q: If a factory operates at 100% of capacity one month, 90% of capacity the next month, and 105% of...
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JM Manufacturing computes its predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year, it estimated that 31,500 direct labor-hours would be required for the period's estimated level of production. The company also estimated $540,000 of fixed manufacturing overhead expenses for the coming period and variable manufacturing overhead of $2.80 per direct labor-hour. JM's actual manufacturing overhead for the year was $678,920, and its actual total direct labor was 32,000 hours. Required: Compute the company's predetermined overhead rate for the year. (Round your answer to 2 decimal places.) Predetermined overhead rate: _____ Per DLH.
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