Question

35. Aspen Technologies has the following budget data: Estimated direct labor hours Estimated direct labor dollars Estimated factory overhead costs 15.000 $90,000 $198,000 If factory overhead is to be applied based on direct labor hours, the predetermined overheadrateis

 

If factory overhead is to be applied based on direct labour hours, the predetermined overhead rate is:

a. $7.50

b. $13.20

c. $2.20

d. $16.50

Answer 1

Predetermined overhead rate = Total overheads cost/ no of direct labour hours

Factory overheads = $198,000

No of hours of direct labour = 15,000

Overheads rate = $198,000/15,000 = $13.20

Ans) predetermined overhead rate = $13.2