A manufacturer of industrial equipment has a standard costing system based on standard direct labor-hours...
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Accounting
A manufacturer of industrial equipment has a standard costing system based on standard direct labor-hours (DLHs) as the measure of activity. Data from the company's flexible budget for manufacturing overhead are given below:
| Level of activity | 2,700 | DLHs | ||
| Overhead costs at the denominator activity level: | ||||
| Variable overhead cost | $ | 8,900 | ||
| Fixed overhead cost | $ | 36,625 | ||
The following data pertain to operations for the most recent period:
| Actual hours | 3,000 | DLHs | ||
| Standard hours allowed for the actual output | 2,612 | DLHs | ||
| Actual total variable manufacturing overhead cost | $ | 9,500 | ||
| Actual total fixed manufacturing overhead cost | $ | 37,025 | ||
What is the predetermined overhead rate to the nearest cent?
$15.51.
$15.18.
$17.23.
$16.86.
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