Tiger Furnishings produces two models of cabinets for home theater components, t

Question

Tiger Furnishings produces two models of cabinets for home theater components, the Basic and the Dominator. Data on operations and costs for March follow: Total Units produced Machine-hours Direct labor-hours Direct materials costs Direct labor costs Manufacturing overhead costs 900 3,000 3,900 $ 8,700 64,600 Basic Dominator 400 2,500 2,900 $ 3,550 31,200 1,300 5,500 6,800 $ 12,250 95,800 229,976 $338,026 Total costs Required: Compute the predetermined overhead rate assuming that Tiger Furnishings uses direct labor costs to allocate overhead costs. (Round your answer to 2 decimal places.) Answer is complete but not entirely correct Predetermined overhead rate 240.0 % of direct labor cost

Explanation / Answer

Calcultion of Predetermined Overhead Rate

(A) Total Manufacturing Overheads

$      229,976.00

(B) Total Direct Labor Cost

$         95,800.00

(A/B) Predetermined Overhead Rate

$ 2.40

Answer Predetermined Overhead rate = $2.40 per each dollar of Labor cost

Predetermined Overhead rate is 240.06% of Direct labor Cost.

The answer already given is not correct only because of decimal error. The question asks answer in two decimal places so Correct Answer will be 240.06% Instead of 240.00%.

If there are any queries , feel free to ask in comment section below.

  

Calcultion of Predetermined Overhead Rate

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.