The following information has been gathered for the Harrell Manufacturing Company for its fiscal year ending December 31: What is the predetermined manufacturing overhead rate per direct labor hour?
$$\begin{array} { | l | r | }
\hline \text { Actual manufacturing overhead costs } & \$ 212,500 \
\hline \text { Actual direct labor hours } & 54,900 \
\hline \text { Actual direct labor costs } & \$ 445,000 \
\hline \text { Estimated manufacturing overhead costs } & \$ 210,000 \
\hline \text { Estimated direct labor } & \$ 434,000 \
\hline \text { Estimated direct labor hours } & 56,000 \
\hline
\end{array}$$
A) $3.87.
B) $3.79.
C) $3.83.
D) $3.75.

Question

The following information has been gathered for the Harrell Manufacturing Company for its fiscal year ending December 31: What is the predetermined manufacturing overhead rate per direct labor hour?
$$\begin{array} { | l | r | } 
\hline \text { Actual manufacturing overhead costs } & \$ 212,500 \
\hline \text { Actual direct labor hours } & 54,900 \
\hline \text { Actual direct labor costs } & \$ 445,000 \
\hline \text { Estimated manufacturing overhead costs } & \$ 210,000 \
\hline \text { Estimated direct labor } & \$ 434,000 \
\hline \text { Estimated direct labor hours } & 56,000 \
\hline
\end{array}$$
A) $3.87.
B) $3.79.
C) $3.83.
D) $3.75.

Quizplus · Accepted Answer

The predetermined overhead rate is calculated by dividing the estimated manufacturing overhead costs by the estimated direct labor hours: $210,000 / 56,000 = $3.75 per direct labor hour.

The Following Information Has Been Gathered for the Harrell Manufacturing