Question

Help Save & Exit At the beginning of the year, a company estimates the following manufacturing costs for the next period: direct labor, $528,000, direct materials, $180,000, and factory overhead, $125,000 Check Required: 1. Compute its predetermined overhead rate as a percent of direct labor. 2. Compute its overhead cost as a percent of direct materials Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Compute its overhead cost as a percent of direct materials. Choose Numerator: Estimated factory overhead $ Overhead Rate 1 Choose Denominator: Estimated direct materials $ - Overhead Rate Overhead Rate 148.000 223.000 < Regt

Answer 1

Solution: Req1 Overhead rate Choose Numerator / Choose Denominator Estimated factory overhead 1/ Estimated direct labor $125,000 7 $528,000 = Overhead rate = Overhead rate = 23.67% Req2 Choose Numerator Estimated factory overhead $125,000 Overhead rate / Choose Denominator = Overhead rate / Estimated direct materials = overhead rate 17 $180,000 = 69.44%