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Harris Fabrics computes its plantwide predetermined overhead rate annually on the basis of direct labor-hours. At the beginni
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Answer #1

Variable overhead cost per direct labor hour = $4

Fixed manufacturing overhead cost = $556,000

Estimated direct labor hours = 41,000

Predetermined overhead rate = Variable overhead cost per direct labor hour + Fixed manufacturing overhead cost/Estimated direct labor hours

= 4 + 556,000/41,000

= 4 + 13.56

= $17.56 per direct labor hour

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