Calculate and Use Manufacturing Overhead Rate

During the coming accounting year, Ester Manufacturing, Inc., anticipates the following costs, expenses, and operating data:

Direct material (15,000 lb.)	$ 112,500
Direct labor (@ $12/hr.)	96,000
Indirect material	17,500
Indirect labor	30,000
Sales commissions	45,000
Factory administration	32,500
Non factory administrative expenses	35,000
Other manufacturing overhead*	70,000
*Provides for operating 30,000 machine hours.

a. Calculate the predetermined manufacturing overhead rate for the coming year for each of the following application bases: (1) direct labor hours, (2) direct labor costs, and (3) machine hours.

Round direct labor hours and machine hours answers to two decimal places, when applicable. Round direct labor costs to two decimal places, when applicable (example: 76.25%).

Application base	Manufacturing overhead rate
Direct labor hours	$Answer
Direct labor costs	Answer%
Machine hours	$Answer

b. For each item in requirement a, determine the proper application of manufacturing overhead to Job 128, to which 22.5 direct labor hours, $250 of direct labor cost, and 80 machine hours have been charged. Round answers to two decimal places, when applicable.

Application base	Overhead applied to Job 63
Direct labor hours	$Answer
Direct labor costs	$Answer
Machine hours	$Answer