Tech solutions computes its predetermined overhead rate annually on the basis of direct labor-hours. at the beginning of the year, it estimated that 62,500 direct labor-hours would be required for the period’s estimated level of client service. the company also estimated $437,500 of fixed overhead cost for the coming period and variable overhead of $0.50 per direct labor-hour. the firm’s actual overhead cost for the year was $458,000 and its actual total direct labor was 67,150 hours. required: 1. compute the predetermined overhead rate

The predetermined overhead rate is $7.5

Explanation:

The computation of the predetermined overhead rate is shown below:

= predetermined fixed overhead rate + predetermined variable overhead rate

where,

Predetermined fixed overhead rate = (Fixed overhead cost ÷ estimated direct labor)

= $437,500 ÷ 62,500 direct labor

= $7

And, the predetermined variable overhead rate is $0.50

Now put these values to the above formula  

So, the value would equal to

= $7 + $0.5

= $7.5

whole quiz

1. the sum of all activities involved in getting high-quality products into the marketplace

2.operations

3. the principle of looking at the supply chain as a whole in order to improve the overall flow through the system.

4. produced; performed

5. activities producing tangible products, such as radios, newspapers, buses, and textbooks.

6. activities producing intangible and tangible products, such as entertainment, transportation, and education.

7.   customer focus

8. analyzing a competitor's products to identify desirable improvements

9. the systematic direction and control of the processes that transform resources into finished projects that create value for and provide benefits to consumers.

10. operation management.

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