Baka Corporation applies manufacturing overhead on the basis of direct labor-hours. At the beginning of the most recent year, the company based its predetermined overhead rate on total estimated overhead of $239,700 and 4,700 estimated direct labor-hours. Actual manufacturing overhead for the year amounted to $242,000 and actual direct labor-hours were 4,600.
-The predetermined overhead rate for the year was closest to:
A) $52.61
B) $49.91
C) $51.00
D) $51.49

Question

Quizplus · Accepted Answer

Predetermined overhead rate = Estimated total manufacturing overhead ÷ Estimated total direct labor-hours
= $239,700 ÷ 4,700 direct labor-hours
= $51.00 per direct labor-hour

Baka Corporation Applies Manufacturing Overhead on the Basis of Direct