Linnear Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for the current year on the following data: ?Total machine-hours30,000?Total fixed manufacturing overhead cost$144,000?Variable manufacturing overhead per machine-hour$4.00Required:Calculate the estimated total manufacturing overhead for the year.
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Estimated total manufacturing overhead cost = Estimated total fixed manufacturing overhead cost + (Estimated variable overhead cost per unit of the allocation base × Estimated total amount of the allocation base) = $144,000 + ($4.00 per machine-hour × 30,000 machine-hours) = $144,000 + $120,000 = $264,000
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