Question

Tiger Furnishings produces two models of cabinets for home theater components, the Basic and the Dominator. Data on operations and costs for March follow:

	Basic		Dominator		Total
Units produced		1,100		450		1,550
Machine-hours		3,600		1,300		4,900
Direct labor-hours		2,200		1,200		3,400
Direct materials costs	$	8,100	$	3,300	$	11,400
Direct labor costs		69,200		40,300		109,500
Manufacturing overhead costs						115,940
Total costs					$	236,840

Required:

Compute the predetermined overhead rate assuming that Tiger Furnishings uses direct labor-hours to allocate overhead costs. (Round your answer to 2 decimal places.)

	Predetermined overhead rate per direct labor hour

Answer 1

Manufacturing overhead costs	115940
Divide by Direct labor-hours	3400
Predetermined overhead rate	34.10	per direct labor hour