purves corporation is using a predetermined overhead rate that was based on an estimated total fixed…

purves corporation is using a predetermined overhead rate that was based on an estimated total fixed manufacturing overhead of $121,000 and 10,000 direct labor - hours for the period. the company incurred actual total fixed manufacturing overhead of $113,000 and 10,900 total direct labor - hours during the period. the predetermined overhead rate is closest to $12.10. $11.30. $11.10. $10.37.

purves corporation is using a predetermined overhead rate that was based on an estimated total fixed manufacturing overhead of $121,000 and 10,000 direct labor - hours for the period. the company incurred actual total fixed manufacturing overhead of $113,000 and 10,900 total direct labor - hours during the period. the predetermined overhead rate is closest to $12.10. $11.30. $11.10. $10.37.

Answer

Explanation:

Step1: Recall the formula for predetermined overhead rate

The formula for predetermined overhead rate (=\frac{\text{Estimated total fixed manufacturing overhead}}{\text{Estimated total direct labor - hours}})

Step2: Substitute the values into the formula

Given that estimated total fixed manufacturing overhead (=$121,000) and estimated total direct labor - hours ( = 10,000) Predetermined overhead rate (=\frac{121000}{10000})

Step3: Calculate the value

(\frac{121000}{10000}=12.1)

Answer:

($12.10)