E 14. Compumatics specializes in the analysis and reporting of complex inventory costing projects. Materials costs are minimal, consisting entirely of operating supplies (DVDs, inventory sheets, and other recording tools). Labor is the highest single expense, totaling $693,000 for 75,000 hours of work last year. Overhead costs for last year were $916,000 and were applied to specific jobs on the basis of labor hours worked. This year the company anticipates a 25 percent increase in overhead costs. Labor costs will increase by $130,000, and the number of hours worked is expected to increase by 20 percent.

1. Determine the total amount of overhead anticipated this year.

2. Compute the overhead rate for this year. (Round your answer to the nearest cent.)

3. During April of this year, 11,980 labor hours were worked. Calculate the overhead amount assigned to April production.

Disposition of Overapplied Overhead