Carey company applies manufacturing overhead costs to products as a percentage of direct labor dollars. estimated and actual values of manufacturing overhead and direct labor costs are summarized here: estimated actual direct labor cost $ 330,000 $ 280,000 manufacturing overhead 653,400 578,400 required: compute the predetermined overhead rate.

198%

Explanation:

The computation of the predetermined overhead rate is shown below:

Predetermined overhead rate = (Total estimated manufacturing overhead) ÷ (estimated direct labor cost)  × 100

= ($653,400 ÷ 330,000) × 100

= 198%

We simply divide the total estimated manufacturing overhead by the estimated direct labor cost so that the predetermined overhead rate can come

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