Question

Question 1 2 pts John's Boats uses job costing. They use direct labor DOLLARS (costs) as a basis for allocating overhead costs to jobs. Given the following information, calculate Johns's predetermined overhead rate. Remember that if your numerator and denominator are both dollars, your overhead rate will be a percentage. So be sure to convert your numerical answer to a percentage, rounded to one decimal place. For example, if your answer after dividing your figures is 4.593, multiply that by 100 to get the percentage form of the answer or 459.3%. Just enter the number and not the percentage sign (for example enter 459.3 if that was your answer) $30,574 $30,801 Actual Overhead Expense Estimated (Budgeted) Overhead Expense Actual Direct Labor Cost Estimated Direct Labor Cost $20,674 $21,560

Answer 1

Ans:

Predetermined overhead rate : Estimate Overhead Head Expenses / Estimated direct labor costs

Estimate Overhead Head Expenses : $30,801

Estimated direct labor costs : $21,560

Predetermined overhead rate : $30,801 / $21,560 = 142.86%

So correct answer is 142.9 or 142.8 (if not rounded off).

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