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Chapter 4: 2. How is the the predetermined overhead rate determined? Finding the predetermined overhead rate is key to finding overhead costs for a specific period. It can be found by dividing the estimated overhead costs by the estimated total amount of the allocation base for the period. The overhead is applied to jobs by multiplying the predetermined overhead rate by the actual amount of the allocation base used by the job. By using this solution, companies can better manage their money and have an idea of the future so they can make more cost-efficient decisions