Predetermined Factory Overhead Rate Spring Street Engine Shop uses a job order cost system to determine the cost of performing engine repair work. Estimated costs and expenses for the coming period are as follows: Engine parts $875,000 Shop direct labor 660,000 Shop and repair equipment depreciation 44,500 Shop supervisor salaries 138,000 Shop property taxes 27,500 Shop supplies 10,000 Advertising expense 22,100 Administrative office salaries 73,500 Administrative office depreciation expense 8,600   Total costs and expenses $1,859,200 The average shop direct labor rate is $30 per hour. Determine the predetermined shop overhead rate per direct labor hour. Round to the nearest cent.$ per direct labor hour

Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter2: Job Order Costing
Section: Chapter Questions
Problem 10E: Exotic Engine Shop uses a job order cost system to determine the cost of performing engine repair...
icon
Related questions
icon
Concept explainers
Question

Predetermined Factory Overhead Rate

Spring Street Engine Shop uses a job order cost system to determine the cost of performing engine repair work. Estimated costs and expenses for the coming period are as follows:

Engine parts $875,000
Shop direct labor 660,000
Shop and repair equipment depreciation 44,500
Shop supervisor salaries 138,000
Shop property taxes 27,500
Shop supplies 10,000
Advertising expense 22,100
Administrative office salaries 73,500
Administrative office depreciation expense 8,600
  Total costs and expenses $1,859,200

The average shop direct labor rate is $30 per hour.

Determine the predetermined shop overhead rate per direct labor hour. Round to the nearest cent.
$ per direct labor hour

Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps with 3 images

Blurred answer
Knowledge Booster
Costing Systems
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Managerial Accounting
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
College Accounting, Chapters 1-27
College Accounting, Chapters 1-27
Accounting
ISBN:
9781337794756
Author:
HEINTZ, James A.
Publisher:
Cengage Learning,
Principles of Cost Accounting
Principles of Cost Accounting
Accounting
ISBN:
9781305087408
Author:
Edward J. Vanderbeck, Maria R. Mitchell
Publisher:
Cengage Learning
Survey of Accounting (Accounting I)
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning
Managerial Accounting: The Cornerstone of Busines…
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
College Accounting, Chapters 1-27 (New in Account…
College Accounting, Chapters 1-27 (New in Account…
Accounting
ISBN:
9781305666160
Author:
James A. Heintz, Robert W. Parry
Publisher:
Cengage Learning