Predetermined Overhead Rate
I have been on this one problem for a while now, it is my last one and for some reason it's just not clicking for me, can anybody help me out? Need an explanation of how to get the answer. Thanks.
Speedy Shoe Factory manufactures running shoes. Overhead is applied to the shoes based on direct labor hours. Last year, total overhead costs were expected to be $72,000. Actual overhead costs totaled $80,000 for 8,000 actual hours. At the end of the year, overhead was underapplied by $5,000.
A.) Calculate The predetermined overhead rate.