Manufacturing overhead was estimated to be $400,000 for the year along with 20,000 direct labor hours. Actual manufacturing overhead was $415,000, actual labor hours were 21,000. The predetermined manufacturing overhead rate per direct labor hour would be:

Question

Quizplus · Accepted Answer

The predetermined manufacturing overhead rate is calculated by dividing the estimated manufacturing overhead by the estimated direct labor hours: $400,000 / 20,000 hours = $20.00 per direct labor hour.

Manufacturing Overhead Was Estimated to Be $400,000 for the Year