Privack Corporation has a standard cost system in which it applies overhead to products based on the standard direct labor-hours allowed for the actual output of the period. Data concerning the most recent year appear below:

Required:

1.         Compute the predetermined overhead rate for the year.

2.         Determine the amount of overhead that would be applied to the output of the period.

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Variable overhead cost per direct labor-hour Total fixed overhead cost per year . $2.00 $250,000 Budgeted standard direct labor-hours (denominator level of activity) 40,000 Actual direct labor-hours 39,000 38,000 Standard direct labor-hours allowed for the actual output