EA3.

LO 6.1A company estimated 100,000 direct labor hours and $800,000 in overhead. The actual overhead was $805,100, and there were 99,900 direct labor hours. What is the predetermined overhead rate, and how much was applied during the year?

Question

Karen Green

Business

26 February, 14:16

EA3.

LO 6.1A company estimated 100,000 direct labor hours and $800,000 in overhead. The actual overhead was $805,100, and there were 99,900 direct labor hours. What is the predetermined overhead rate, and how much was applied during the year?

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Answers (1)

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Justice · Answer 1

Predetermined overhead rate=$8 per hour

Applied overheads=$799,200

Explanation:

Predetermined overhead rate is calculated using the following formula:

Predetermined overhead rate=Estimated overhead/Estimated direct labor hours

Predetermined overhead rate=800,000/100,000

=$8 per hour

Applied overheads = Predetermined overhead rate*number of direct labor hours

Applied overheads=8*99,900

=$799,200

EA3.LO 6.1A company estimated 100,000 direct labor hours and $800,000 in overhead. The actual overhead was $805,100, and there were 99,900 direct labor hours. What is the predetermined overhead rate, and how much was applied during the year?

EA3.

LO 6.1A company estimated 100,000 direct labor hours and $800,000 in overhead. The actual overhead was $805,100, and there were 99,900 direct labor hours. What is the predetermined overhead rate, and how much was applied during the year?