Calculate the predetermined manufacturing overhead rate for the coming year using direct labor hour as the allocation base. Round your answer to two decimal places when applicable.
Calculate the predetermined manufacturing overhead rate for the coming year using direct labor hour as the allocation base. Round your answer to two decimal places when applicable.
Chapter6: Activity-based, Variable, And Absorption Costing
Section: Chapter Questions
Problem 1EA: Steeler Towel Company estimates its overhead to be $250,000. It expects to have 100,000 direct labor...
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Question
During the coming accounting year, Baker Manufacturing, Inc., anticipates the following costs, expenses, and operating data:
Direct material (16,000 lb.) |
$70,000 |
Direct labor (@ $20/hr.) |
$20,000 |
Factory administration |
$15,000 |
Indirect labor |
$10,000 |
Indirect material |
$14,000 |
Non factory administrative expenses |
$16,000 |
Other manufacturing |
$15,000 |
Maintenance of factory machine |
$20,000 |
Sales commissions |
$70,000 |
Direct labor hours |
2,000 |
Machine hours |
8,000 |
Calculate the predetermined manufacturing overhead rate for the coming year using direct labor hour as the allocation base. Round your answer to two decimal places when applicable.
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