Techniques, Inc. uses a predetermined manufacturing overhead rate based on direc

Question

Techniques, Inc. uses a predetermined manufacturing overhead rate based on direct labor hours to apply its indirect product costs to jobs. The following information has been collected for the previous year:

Techniques used 30,000 direct labor hours and 60,000 machine hours during the previous year. What is the predetermined overhead rate per direct labor hour?

$8.32 per hour.

$17.00 per hour.

$10.50 per hour.

$9.37 per hour.

Techniques, Inc. uses a predetermined manufacturing overhead rate based on direct labor hours to apply its indirect product costs to jobs. The following information has been collected for the previous year:

Explanation / Answer

Techniques Inc Last years Manufacturing Overhead details Cost Details Amt $ Indirect Labor         63,000.00 Depreciation Factory building         94,500.00 Utilities Factory       157,500.00 Total Manufacturing Overhead       315,000.00 Total Direct labor hours used         30,000.00 Predermined Overhead rate per Direct Labor hour =315000/30000                  10.50 So Answer is $10.50 per hour.

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