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Tiger Furnishings produces two models of cabinets for home theater components, the Basic and the Dominator. Data on operations and costs for March follow: Basic
Tiger Furnishings produces two models of cabinets for home theater components, the Basic and the Dominator. Data on operations and costs for March follow:
Basic | Dominator | Total | ||||
Units produced | 1,000 | 250 | 1,250 | |||
Machine-hours | 4,500 | 2,500 | 7,000 | |||
Direct labor-hours | 3,000 | 2,000 | 5,000 | |||
Direct materials costs | $ | 10,000 | $ | 3,750 | $ | 13,750 |
Direct labor costs | 64,500 | 35,500 | 100,000 | |||
Manufacturing overhead costs | 175,000 | |||||
Total costs | $ | 288,750 | ||||
Required:
Compute the predetermined overhead rate assuming that Tiger Furnishings uses direct labor-hours to allocate overhead costs.
Predetermined Overhead Rate __$___________per direct labor hour
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