Longobardi Corporation bases its predetermined overhead rate on the estimated labor-hours for the upcoming year.At the beginning of the most recently completed year, the Corporation estimated the labor-hours for the upcoming year at 46,000 labor-hours.The estimated variable manufacturing overhead was $6.25 per labor-hour and the estimated total fixed manufacturing overhead was $1,026,260.The actual labor-hours for the year turned out to be 41,200 labor-hours.The predetermined overhead rate for the recently completed year was closest to:

A) $28.56 per labor-hour
B) $22.31 per labor-hour
C) $6.25 per labor-hour
D) $31.16 per labor-hour

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Duyên Nguy?n Hoàng M? · Accepted Answer

Final Answer : A, Explanation :  Estimated total manufacturing overhead = $1,026,260 + ($6.25 per labor-hour × 46,000 labor-hours)= $1,313,760Predetermined overhead rate = Estimated total manufacturing overhead ÷ Estimated total amount of the allocation base = $1,313,760 ÷ 46,000 labor-hours = $28.56 per labor-hour

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