Logan products computes its predetermined overhead rate annually basis of direct labor hours. At the beginning of the year. it estimated that 40000 direct labor hours would be required for the ...
... period's estimated level of production. the company also estimated $466000 of fixed manufacturing overhead expences for the coming period and variable manufacturing overhead of 3.00 per direct labor hours. Logan's actual manufacturing overhead for the year was $713400 and its actual total direct labor was 41000 hours
The predetermined overhead rate is:
Predetermined overhead rate = ESTIMATED overhead / ESTIMATED cost driver
= $134,000/ 20,000
=$6.7 per labor hour.
-EXTRA INFO: predetermined overhead ...
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