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o ta ornes here. sid *thm e, and dag the Kavorites " 5older. Cr mport bom another brenmirport favorites Week 1 Help Save i 3 Harris Fabrics computes its plantwide predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year, it estimated that 28,000 direct labor-hours would be required for the period's estlimated level of production. The company also estimated $592,000 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $3.00 per direct labor hour. Harris's actual manufacturing overhead cost for the year was $736,521 and its actual total direct labor was 28,500 hours. 208 Required: Compute the company's plantwide predetermined overhead rate for the year. (Round your answer to 2 decimal pleces.) er DLH Type here to search

Explanation / Answer

The estimated total manufacturing overhead cost is computed as follows:

Y = $592,000 + ($3.00 per DLH)(28,000 DLHs)

Predetermined overhead rate = Estimated total manufacturing overhead / Estimated total direct labor hours (DLHs) = $676,000 / 28,000 DLHs = $24.14 per DLH

Estimated fixed manufacturing overhead $592,000 Estimated variable manufacturing overhead($3.00 per DLH × 28,000 DLHs) $84,000 Estimated total manufacturing overhead cost $676,000

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