The following information is available for the current year:

Cost of goods sold $292,000

Depreciation of factory equipment 25,200

Direct labor 64,750

Finished goods inventory, Beginning-year 45,000

Factory insurance 11,200

Factory utilities 16,800

Goods transferred from Work in Process 285,150

Inventory to Finished Goods Inventory

Indirect labor 8,400

Raw materials inventory, Beginning-year 4,200

Raw materials purchased 116,200

Raw materials used in production 121,800

(includes $7,000 of indirect materials)

Rent on factory building 22,400

Discuss the results of operations for the current year and provide your recommendations for increase or decrease in the overhead rate. Assume that the total sales of these products for the year, for cash and on account, was $450,000 and that costs for operating expenses, interest expenses and taxes equaled $110,000.