Harris Fabrics computes its predetermined overhead rate annually on the basis of direct labor hours. At the beginning of the year, it estimated that 20,000 direct labor-hours would be required for the periods estimated level of production. The company also estimated $94,000 of fixed manufacturing overhead expenses for the coming period and variable manufacturing overhead of $2.00 per direct labor-hour. Harriss actual manufacturing overhead for the year was $123,900 and its actual total direct labor was 21,000 hours. Required: Compute the companys predetermined overhead rate for the year.

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