Question

Lucid Lighting uses a predetermined overhead rate based on machine-hours to apply manufacturing overhead to jobs. Lucid has provided the following estimated costs for next year: Direct materials Direct labor Sales commissions Salary of production supervisor Indirect materials Advertising expense Rent on factory equipment OH Costs Lucid estimates that 10,000 direct labor-hours and 15,000 machine-hours will be worked during the year. The predetermined overhead rate per hour will be:

Answer 1

$2.27

Step-by-step explanation:

Note: The missing word is attached as picture

Salary of production supervisor $20,000

Indirect materials $4,000

Rent of factory Equipment $10,000

Total estimated factory overhead $34,000

Divide by Estimated machine hours 15,000

Predetermined overhead rate $2.27