The following data relates to Patterson Company's estimated amounts for next year. What is the company's plantwide overhead rate if direct labor hours are the allocation base? $\bold{\text{(Round your answer to two decimal places.)}}$
A)$3.45 per DLH
B)$5.45 per DLH
C)$0.29 per DLH
D)$0.26 per DLH
E)$0.20 per DLH

Question

The following data relates to Patterson Company's estimated amounts for next year. What is the company's plantwide overhead rate if direct labor hours are the allocation base? $\bold{\text{(Round your answer to two decimal places.)}}$
A)$3.45 per DLH 
B)$5.45 per DLH 
C)$0.29 per DLH 
D)$0.26 per DLH 
E)$0.20 per DLH

Quizplus · Accepted Answer

To find the plantwide overhead rate, we need to divide the estimated total overhead costs by the estimated total direct labor hours. ($95,000 + $35,000 + $25,000 = $155,000 for total overhead costs, and 535 direct labor hours for total direct labor hours). Therefore, the plantwide overhead rate is $155,000 ÷ 535 = $289.72 per DLH. Rounding this to two decimal places gives us $0.29 per DLH, which is option C.

The Following Data Relates to Patterson Company's Estimated Amounts for Next