Nazareth Company estimates overhead of $225,000 for the next year. An estimated 25,000 units will be produced, with materials cost of $500,000.
Conversion will require an estimated 56,250 direct labor hours at a cost of $8 per hour, and an estimated 75,000 machine hours.
Required:
Compute the predetermined overhead rate to be used in applying factory overhead to production on each of the following bases:
(1) Units of production
(2) Materials cost
(3) Direct labor hours
(4) Direct labor cost
(5) Machine hours