Archangel Manufacturing calculated a predetermined overhead allocation rate at the beginning of the year based on direct labor costs.The production details for the year are given below: $$\begin{array} { | l | l | }
\hline \text { Total manufacturing overhead costs estimated at the beginning of the year } & \$ 150,000 \
\hline \text { Total direct labor costs estimated at the beginning of the year } & \$ 340,000 \
\hline \text { Total direct labor hours estimated at the beginning of the year } & 10,000 \text { direct labor hours } \
\hline \text { Actual manufacturing overhead costs for the year } & \$ 150,000 \
\hline \text { Actual direct labor costs for the year } & \$ 360,000 \
\hline \text { Actual direct labor hours for the year } & 11,000 \text { direct labor hours } \
\hline
\end{array}$$ Calculate the manufacturing overhead allocation rate for the year based on the above data.(Round your final answer to two decimal places.)

Question

Archangel Manufacturing calculated a predetermined overhead allocation rate at the beginning of the year based on direct labor costs.The production details for the year are given below: $$\begin{array} { | l | l | } 
\hline \text { Total manufacturing overhead costs estimated at the beginning of the year } & \$ 150,000 \
\hline \text { Total direct labor costs estimated at the beginning of the year } & \$ 340,000 \
\hline \text { Total direct labor hours estimated at the beginning of the year } & 10,000 \text { direct labor hours } \
\hline \text { Actual manufacturing overhead costs for the year } & \$ 150,000 \
\hline \text { Actual direct labor costs for the year } & \$ 360,000 \
\hline \text { Actual direct labor hours for the year } & 11,000 \text { direct labor hours } \
\hline
\end{array}$$ Calculate the manufacturing overhead allocation rate for the year based on the above data.(Round your final answer to two decimal places.)

Quizplus · Accepted Answer

The manufacturing overhead allocation rate is calculated by dividing the total estimated manufacturing overhead costs by the total estimated direct labor costs, then multiplying by 100 to get a percentage. So, $\frac{\$150,000}{\$340,000} \times 100 = 44.12\%$.

Archangel Manufacturing Calculated a Predetermined Overhead Allocation Rate at the Beginning