Zephyros Corporation had estimated manufacturing overhead costs for the coming year to be $303,000
The total estimated direct labor hours and machine hours for the coming year are 7,000 and 12,000, respectively. Manufacturing overhead costs are allocated based on direct labor hours. What is the predetermined overhead allocation rate? (Round your answer to the nearest cent.)
A) $25.25 per machine hour
B) $15.95 per direct labor hour
C) $43.29 per direct labor hour
D) $1.71 per machine hour
C .C) Predetermined overhead allocation rate = Total estimated overhead costs / Total estimated quantity of the overhead allocation base
Predetermined overhead allocation rate = $303,000 / 7,000 labor hours = $43.29 per labor hour
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