Ask Experts Questions for FREE Help !
Ask
    student83's Avatar
    student83 Posts: 2, Reputation: 1
    New Member
    		  
    #1

    Sep 15, 2013, 08:34 AM
    Overhead Rate Acct. Question
    Calculate the predetermined overhead rate for 2014, assuming Degelman Company estimates total manufacturing overhead costs of $980,000, direct labor costs of $700,000, and direct labor hours of 20,000 for the year
    rehmanvohra's Avatar
    rehmanvohra Posts: 739, Reputation: 27
    Senior Member
    		  
    #2

    Sep 16, 2013, 05:18 AM
    Overhead absorption rate is calculated as follows:


    Estimated overheads
    Estimated direct labor costs

    980,000/700000
    = 140%

    Estimated overheads
    Estimated direct labor hours

    980000/20000
    = 490 per labor hour
Not your question? Ask your question View similar questions
 

Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.


Check out some similar questions!

Determine the predetermined overhead rate if the predetermined overhead rate... [ 1 Answers ]

The management of Sharrar Corporation would like to investigate the possibility of basing its predetermined overhead rate on activity at capacity rather than on the estimated amount of activity for the year. The company's controller has proveded an example to illustrate how this new system would...

How do you calculate the overhead application rate for estimated overhead costs? [ 1 Answers ]

How do you calculate the overhead application rate?

Labor efficiency variance, variable overhead rate variance, variable overhead efficie [ 1 Answers ]

Becton Labs, Inc. produces various chemical compounds for industrial use. One compound, called Fludex, is prepared using an elaborate distilling process. The company has developed standard costs for one unit of Fludex, as follows: Standard Quantity Standard Price or Rate Standard Cost ...

Predetermined Overhead Rate & Overhead Applied [ 1 Answers ]

B3 Company is a manufacturing firm that uses job-order costing. The company applies overhead to jobs using a predetermined overhead rate based on machine-hours. At the beginning of the year, the company estimated that it would work 24,000 machine-hours and incur $216,000 in manufacturing overhead...

View more questions Search