Question
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 | $ | 353,800 | |
Factory machinery depreciation | 60,000 | ||
Factory supervisor salaries | 138,500 | ||
Factory direct labor | 209,616 | ||
Factory supplies | 43,900 | ||
Factory property tax | 34,250 | ||
Advertising cost | 25,500 | ||
Administrative salaries | 51,000 | ||
Administrative-related depreciation | 19,200 | ||
Total expected costs | $ | 935,766 | |
Required: 1. Calculate the predetermined overhead rate per direct labor hour if the average direct labor rate is $11.91 per hour. (Round your answer to 2 decimal places.) 2. Determine the amount of applied overhead if 17,900 actual hours are worked in the upcoming year. (Round your intermediate calculations to 2 decimals. Round your final answer to the nearest whole dollar.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started