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es Tech Solutions computes its predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year, it estimated that
es Tech Solutions computes its predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year, it estimated that 100,000 direct labor-hours would be required for the period's estimated level of client service. The company also estimated $1,400,000 of fixed overhead cost for the coming period and variable overhead of $0.50 per direct labor-hour. The firm's actual overhead cost for the year was $1,418,700 and its actual total direct labor was 104,000 hours. Required: 1. Compute the predetermined overhead rate. 2. During the year, Tech Solutions started and completed the Xavier Company engagement. The following information was available with respect to this job: Direct materials Direct labor cost Direct labor-hours worked $ 41,250 $ 27,800 400 Compute the total job cost for the Xavier Company engagement.
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