The following information has been gathered for Foxmoor Industries for its fiscal year ending December 31: Estimated factory overhead costs $ 2,496,000 Actual factory overhead costs $ 1,812,400 Estimated labor hours 78,000 Actual labor hours 81,700 Estimated labor costs $ 771,000 Actual labor costs $ 855,125 Estimated machine hours 111,000 Actual machine hours 117,600 What is the predetermined factory overhead rate per labor hour?

Question

Business

Celeste Mckenzie

16 September, 05:44

The following information has been gathered for Foxmoor Industries for its fiscal year ending December 31: Estimated factory overhead costs $ 2,496,000 Actual factory overhead costs $ 1,812,400 Estimated labor hours 78,000 Actual labor hours 81,700 Estimated labor costs $ 771,000 Actual labor costs $ 855,125 Estimated machine hours 111,000 Actual machine hours 117,600 What is the predetermined factory overhead rate per labor hour?

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Answers (1)

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Noel Ali · Answer 1

Estimated manufacturing overhead rate = $32 per labor hour

Explanation:

Giving the following information:

The estimated factory overhead costs $ 2,496,000. Estimated labor hours 78,000.

Estimated manufacturing overhead rate = total estimated overhead costs for the period / total amount of allocation base

Estimated manufacturing overhead rate = 2496000/78000 = $32 per labor hour