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Home Q & A Board Other Fields Homework Help Business Accounting
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amandeep68 amandeep68
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5 years ago
A furniture corporation manufactures two models of furnitureStandard and Deluxe. The total estimated manufacturing overhead costs are $64,350. The following estimates are available:

StandardDeluxe
Direct materials cost per unit$240$290
Direct labor cost per unit$120$140
Number of units240500

The company uses direct labor costs as the base to allocate manufacturing overhead. Calculate the predetermined overhead rate. (Round your answer to two decimal places.)
A) 31.76%
B) 33.94%
C) 191.52%
D) 65.13%
Textbook 
Horngren's Accounting

Horngren's Accounting


Edition: 11th
Authors:
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Replies
wrote...
#1
5 years ago
 D
Explanation:  D) Total direct labor cost = ($120  240 units) + ($140  500 units) = $98,800
Predetermined overhead allocation rate = $64,350 / $98,800 = 65.13% of direct labor costs
L u c k y  D u c k y
amandeep68 Author
wrote...
#2
5 years ago
Marking this solved, moving on to the next...
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