Martinez Foundry in Philadelphia, Pennsylvania, uses a predetermined manufacturing overhead rate to allocate overhead to individual jobs based on the machine hours required. Requirement $1.$ Compute Martinez's predetermined manufacturing overhead rate.

Determine the formula to calculate the predetermined overhead rate, then calculate the rate.

Estimated yearly direct labor cost

Estimated yearly direct labor hours

Estimated yearly machine hours

Estimated yearly overhead costs

Requirements

Compute Martinez's predetermined manufacturing overhead rate.

How much manufacturing overhead was allocated to jobs during the year?

How much manufacturing overhead was incurred during the year? Is

manufacturing overhead underallocated or overallocated at the end of

the year? By how much?

Were the jobs overcosted or undercosted? By how much?

At the beginning of the year, the company expected to incur the following:

View the costs.

Read the requirements.

Requirement $1.$ Compute Martinez's predetermined manufacturing overhead rate.

Determine the formula to calculate the predetermined overhead rate, then calculate the rate.

Estimated yearly direct labor cost

Estimated yearly direct labor hours

Estimated yearly machine hours

Estimated yearly overhead costs

Costs