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Wheelers Bike Company manufactures custom racing bicycles. The company uses a job order cost system to determine the cost of each bike. Estimated costs and
Wheelers Bike Company manufactures custom racing bicycles. The company uses a job order cost system to determine the cost of each bike. Estimated costs and expenses for the coming year follow: Bike parts $ 356,800 Factory machinery depreciation 57,500 Factory supervisor salaries 139,000 Factory direct labor 233,308 Factory supplies 38,900 Factory property tax 25,250 Advertising cost 22,000 Administrative salaries 48,000 Administrative-related depreciation 18,700 Total expected costs $ 939,458 Required: Calculate the predetermined overhead rate per direct labor hour if the average direct labor rate is $12.41 per hour. Determine the amount of applied overhead if 18,100 actual hours are worked in the upcoming year
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