Question: Logan Products computes its predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year it estimated that its total

Logan Products computes its predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year it estimated that its total manufacturing overhead would be $586,000 and the total direct labor would be 40,000 hours. Its actual total manufacturing overhead for the year was $713,400 and its actual total direct labor was 41,000 hours.

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Compute the company’s predetermined overhead rate for the year.

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