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Purves Corporation is using a predetermined overhead rate that was based on estimated total fixed manufacturing overhead of $121,000 and 10,000 direct labor-hours for the period. The company incurred actual total fixed manufacturing overhead of $113,000 and 10,900 total direct labor-hours during the period. The predetermined overhead rate is closest to: a. $10.37 b. $12.10 c. $11.10 d. $11.30

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hyderali230

Answer:

b. $12.10

Explanation:

Estimated total fixed manufacturing overhead = $121,000

Estimated direct labor-hours = 10,000 hours

Predetermined Overhead rate = Estimated total fixed manufacturing overhead / Estimated direct labor-hours

Predetermined Overhead rate = $121,000 / 10,000 hours

Predetermined Overhead rate = $12.10 / labor hour

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