Estimated manufacturing overhead$450,000Estimated direct labor hours150,000Actual manufacturing overhead$405,000Actual direct labor hours180,000 Based on this information, the predetermined overhead rate per direct labor hour is $. (Enter your answer as a whole number.)
Question
Estimated manufacturing overhead405,000Actual direct labor hours180,000 Based on this information, the predetermined overhead rate per direct labor hour is $. (Enter your answer as a whole number.)
Solution
The predetermined overhead rate is calculated by dividing the estimated manufacturing overhead by the estimated direct labor hours.
Here are the steps to calculate it:
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Identify the estimated manufacturing overhead. From the information given, the estimated manufacturing overhead is $450,000.
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Identify the estimated direct labor hours. From the information given, the estimated direct labor hours are 150,000 hours.
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Divide the estimated manufacturing overhead by the estimated direct labor hours to get the predetermined overhead rate per direct labor hour.
So, 3 per direct labor hour.
Therefore, the predetermined overhead rate per direct labor hour is $3.
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